June 12, 2017 by Canadian Underwriter
Commercial insurance prices in the United States were nearly flat during the first quarter of 2017, according to the last Commercial Lines Insurance Pricing Survey (CLIPS) from Willis Towers Watson (WTW).
The survey, released on Monday, compared prices charged on commercial policies written during the first quarter of 2017 to those charged for the same coverage during the equivalent quarter in 2016. Price changes reported by carriers averaged less than 1% for the sixth consecutive quarter, following a moderating trend in price increases that began in the first quarter of 2013, the global advisory, broking and solutions company said in a press release.
WTW explained that for the most recent survey, data were contributed by 39 participating insurers, representing approximately 20% of the U.S. commercial insurance market (excluding state workers compensation funds). This survey compared prices charged on policies written during the first quarter of 2017 to the prices charged for the same coverage during the same quarter of 2016.
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. property & casualty insurers that includes many of the “top 10” commercial lines companies and the “top 25” insurance groups in the country, WTW reported.
According to the most recent survey, price changes in Q1 2017 for most lines of business were fairly consistent with changes reported in Q4 2016. Four lines (surety, workers compensation, commercial property and directors and officers) indicated “modest price” decreases, the release said. The outlier in the results continued to be commercial auto, where “meaningful price increases were again reported.” For most other lines, price changes fell in the low single digits, the release said. Price changes were fairly similar across segments, though slightly positive for small accounts, and flat for mid-market, large and specialty accounts.
“Despite ample capital and benign claim cost inflation trends, the commercial P&C insurance market has exercised considerable discipline as a whole over the past couple of years,” said Serhat Guven, Americas property & casualty sales practice leader with WTW, in the release. “Insurers have held the line on trading profitability for volume, while still responding as needed to emerging trends, e.g., commercial auto on the high end and workers compensation on the low end.”