General Insurance Article - Aggregate commercial insurance increase largest in 8yrs


Aggregate commercial insurance price increase largest in last 8 years, says Towers Watson Survey

 Commercial insurance prices in aggregate increased by 6% during the second quarter of 2012 — the sixth consecutive quarter aggregate prices rose for all commercial lines, according to the new Commercial Lines Insurance Pricing Survey, conducted by Towers Watson. The survey compared prices charged on policies underwritten during the second quarter of 2012 to those charged for the same coverage during the same quarter in 2011.

 Workers compensation and commercial property experienced the largest price adjustments, with increases in the high single digits. Directors and officers, and employment practices liability data saw price increases in the mid-single digits, a departure from the relatively flat pricing of the last two quarters.

 For commercial lines, price increases were observed for all account sizes. Increases for mid-market and large accounts were larger than those seen for small commercial accounts. Specialty commercial lines pricing rebounded, though increases were not as large as those observed in standard commercial lines.

 Loss cost information reported by participating carriers pointed to an improvement of more than 1% in loss ratios in accident-year-to-date 2012 relative to 2011, as earned price increases more than offset reported claim cost inflation. This indication is a reversal from the estimated 3% loss ratio deterioration between 2010 and 2011. Carrier estimates of claim cost inflation improved since the prior quarter, as estimated claim cost inflation through the first half of 2012 in aggregate is 2%, compared to almost 4% in 2011.

 “Improving loss ratios do not necessarily mean better results, as faltering investment income offsets improvements in underwriting outcomes,” said Thomas Hettinger, property & casualty sales and practice leader for the Americas at Towers Watson. “Insurers’ success as 2012 draws to a close will continue to depend on pricing discipline and moderate loss trends.”

Back to Index


Similar News to this Story

LMA response to Blueprint Two cutover delay
Sheila Cameron, CEO of the LMA comments “The LMA welcomes the decision by Velonetic, and supported by Lloyd’s Council, to postpone the cutover date fo
Car insurance premiums increase by GBP132 year on year
Cost of car insurance increases by 18% year-on-year as the typical premium now stands at £850. Drivers aged 80+ see the steepest proportional rise in
IPT receipts already GBP228 million higher than last year
After a record £8.1 billion of Insurance Premium Tax (IPT) collections last year, receipts in May hit £1,431 million, reinforcing last month’s £615 mi

Site Search

Exact   Any  

Latest Actuarial Jobs

Actuarial Login

Email
Password
 Jobseeker    Client
Reminder Logon

APA Sponsors

Actuarial Jobs & News Feeds

Jobs RSS News RSS

WikiActuary

Be the first to contribute to our definitive actuarial reference forum. Built by actuaries for actuaries.