U.S. commercial insurance prices continue their upward trajectory
Carriers reported aggregate price increases of over 4%
ARLINGTON, Va., Dec. 09, 2019 (GLOBE NEWSWIRE) -- U.S. commercial insurance prices accelerated during the third quarter of 2019, as the aggregate price change reported by carriers exceeded 4%, according to Willis Towers Watson’s (NASDAQ: WLTW) (CLIPS). The survey compared prices charged on policies underwritten during the third quarter of 2019 to those for the same coverage during the third quarter of 2018.
Data for commercial auto, commercial property, excess/umbrella liability and directors and officers (D&O) all indicated significant price increases. The survey reported price reductions for only one line, workers compensation, although the reductions were more modest in the third quarter than in prior quarters. Price changes were more pronounced for large accounts than those reported for small and mid-market accounts. Specialty lines price increases also trended upward significantly.
“This quarter we saw the largest overall price shift since 2013,” said Alejandra Nolibos, senior director, Insurance Consulting and Technology, Willis Towers Watson. “Price increases for D&O liability are well into the double digits, with employment practices liability and medical professional liability also showing sizable upward shifts. Commercial auto did not let up, with insureds looking at double-digit increases again. CLIPS confirms insurers have been responding to worsening loss trends across affected lines through pricing; other sources suggest terms and conditions have tightened. The question is whether and when workers compensation loss trends will turn, too.”
CLIPS is a retrospective look at historical changes in commercial P&C prices and claim cost inflation. A forward-looking analysis of commercial P&C trends, outlook and rate predictions can be found in Willis Towers Watson’s series.
About Willis Towers Watson
Willis Towers Watson (NASDAQ: WLTW) is a leading global advisory, broking and solutions company that helps clients around the world turn risk into a path for growth. With roots dating to 1828, Willis Towers Watson has 45,000 employees serving more than 140 countries and markets. We design and deliver solutions that manage risk, optimize benefits, cultivate talent, and expand the power of capital to protect and strengthen institutions and individuals. Our unique perspective allows us to see the critical intersections between talent, assets and ideas — the dynamic formula that drives business performance. Together, we unlock potential. Learn more at .
About CLIPS
CLIPS data are based on both new and renewal business figures obtained directly from carriers underwriting the business. CLIPS participants represent a cross section of U.S. P&C insurers that includes many of the top 10 commercial lines companies and the top 25 insurance groups in the U.S. This particular survey compared prices charged on policies written during the third quarter of 2019 with the prices charged for the same coverage during the same quarter of 2018. For this most recent survey, 39 participating insurers representing approximately 20% of the U.S. commercial insurance market (excluding state workers compensation funds) contributed data.
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