Elevated pricing data supports firming of the market
Arlington, VA (Sept. 9, 2019) – U.S. commercial insurance prices increased by nearly 4% in the second quarter of 2019 compared to prices charged during the second quarter of 2018, according to leading global advisory, broking and solutions company Willis Towers Watson’s latest Commercial Lines Insurance Pricing Survey (CLIPS). This represents a significant pickup from increases of close to 2% for each of the previous five quarters.
Prices for most lines showed increases, with property, excess/umbrella, and directors and officers (D&O) approaching double digits for the first time in several years. Commercial auto, the past outlier in the results, saw reported price increases near or above double digits for the seventh consecutive quarter. Price changes trended upward for all account sizes, though more significantly for mid-market and large accounts.
“After so many quarters of modest increases we are seeing a pickup, backing up general market sentiment,” said Alejandra Nolibos, senior director, Insurance Consulting and Technology business, Willis Towers Watson. “Adverse loss trends in auto and D&O, and deteriorating or potentially deteriorating loss trends in other casualty lines, together with the prospect of potentially diminishing reserve releases seems to have pushed carriers to demand higher prices.”
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 Marketplace Realities 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 willistowerswatson.com.
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 second quarter of 2019 with the prices charged for the same coverage during the same quarter of 2018. For the most recent survey, 41 participating insurers contributed data.
SOURCE: Willis Towers WatsonTags: commercial lines, Commercial Lines Insurance Pricing Survey (CLIPS), insurance pricing, United States (USA), Willis Towers Watson