Workers Compensation and Commercial Auto saw the biggest gains in the first month of 2014
While both Workers’ Compensation and Commercial saw strong gains in January of plus four percent, overall the composite rate for commercial insurance rates barely matched its year-end results for 2013. According to MarketScout CEO Richard Kerr the rates for five coverage classes decreased one percentage point as compared to their numbers a year ago. The beginning of 2013 saw a composite rate increase of plus five percent, a trend which continued for the most of the first half of the 2013 calendar year. It was only in July of 2013 when things began to moderate slightly. By year-end, December 2013 saw the composite rate at a plus three percent.
“No coverage classifications had a rate increase. By account size, half the accounts measured enjoyed premium reductions of 1 percent. By industry class, four out of seven were down 1 percent. If we were to post rate changes by fractional increments, you would see the actual increase at 2.55 percent, so the moderation trend continues.”
Kerr cites additional capacity, insurance linked securities and a more stable economic environment as the factors most responsible for the moderating rate environment.
An in-depth look at the numbers….
|By Coverage Class||Rate Change|
|Commercial Property||Up 2%|
|Business Interruption||Up 2%|
|Inland Marine||Up 1%|
|General Liability||Up 3%|
|Commercial Auto||Up 4%|
|Workers’ Compensation||Up 4%|
|Professional Liability||Up 2%|
|D&O Liability||Up 2%|
|By Account Size||Rate Change|
Up to $25,000
Over $1 million
|By Industry Class||Rate Change|
|Public Entity||Up 2%|