April 25, 2016 by Canadian Underwriter
Commercial insurance prices in aggregate for Canadian insurers increased 3.8% in the general products and liability line during the fourth quarter of 2015 compared to those charged for the same coverage during Q4 2014, according to the latest Willis Towers Watson (WTW) Commercial Lines Insurance Pricing Survey – Canada (CLIPS Canada).
The most recent survey compared prices charged on policies underwritten during the Q4 2015 to those charged for the same coverage during Q4 2014. Data was contributed by seven Canadian insurers/groups, representing approximately 20% of the Canadian commercial insurance market, WTW said on Monday.
Price increases were reported for commercial auto, general products liability and excess umbrella liability. While the largest price increases were in the general products and liability line, professional liability had the largest pricing decrease at -20.9%, WTW said. Commercial property, which represents the largest volume reflected in the survey, showed a decrease of -0.6%.
Price changes for all lines were in the low- to mid-single digits.
Other aggregate findings include:
– The increase was highest in the second quarter 2014 at 2.7%. Since the third quarter of 2014, the magnitude of the price level increase had been gradually decreasing until the third quarter of 2015, where the increase reduced to around zero;
– Survey respondents reported a 0.1% written premium price level increase during the fourth quarter of 2015;
– Commercial insurance prices in aggregate have been increasing marginally for the past three years;
– Reported claim cost information reveals a loss ratio improvement of 2.4% in accident year 2015 compared to the same period in 2014; and
– Carrier estimates of the claim cost inflation underlying the loss ratio movement is -0.7% for accident year 2015.