August 11, 2021 by Jason Contant
Canada’s hard market in commercial P&C is showing no signs of letting up, with all major lines seeing average premium renewal rate increases in the second quarter of 2021.
“Overall, the magnitude of rate increases across all segments included in the index relative to average premium renewals in the same quarter last year is 9.12% in Q2 2021,” Applied Systems said in a press release last week announcing the results of its latest quarterly commercial premium rate index.
Quarter over quarter, Q2 2021 results showed increases on renewals across the most commonly-placed commercial lines, which include real estate property, business and professional services, construction, hospitality, and retail services.
“This quarter’s index demonstrates a continued hardening of the market across all classes of commercial lines of business included in the index, with most seeing significant quarterly increases,” said Steve Whitelaw, vice president and general manager, Canada, with Applied Systems.
The premium renewal rate change for hospitality services averaged 8.99% in Q2 2021, Applied reported in its Commercial Index, which analyzes nearly 22,000 data transactions per quarter. “Quarter over quarter, average premium renewal rate change significantly increased after reaching a low point in Q1 2021 (6.21%). The Q2 2021 average premium renewal rate change was up more than two-and-a-half points as compared to the same quarter last year (6.31%).”
For construction, erection and installation services, premium renewal change averaged 10.27% in Q2. This was up from Q1 2021 at 8.76%, and 7.85% compared to Q2 2020.
In business and professional services, the renewal rate changed an average of 8.57% in the most recent quarter, up from 6.59% in the first quarter of 2021 and 7.36% in Q2 2020.
The average real estate property premium renewal rate change was 10.62% in the latest quarter. This average rate was up slightly compared to the first quarter of 2021 (10.26%). Year-over-year, the average premium rate changed dropped slightly from 10.73% in Q1 2021.
In retail services, the average renewal rate change was 8.3% in Q2 2021. Quarter over quarter, the average rate change was up as compared to 7.12% in Q1 2021, but down almost half a point from the same quarter last year (7.87%).
Feature image via iStock.com/Sitthiphong