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U.S. commercial insurance prices edge slightly higher during the fourth quarter

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  • Topics:
    • Directors & Officers
    • Motor (Commercial)
    • Property - North America
    • Rates

Price increases remain less than 1% for the 10th consecutive quarter. Commercial insurance prices in the U.S. inched upward in the fourth quarter of 2017...

...according to Willis Towers Watson’s Commercial Lines Insurance Pricing Survey (CLIPS).


The survey compared prices charged on policies written during the fourth quarter of 2017 with those charged for the same coverage during the equivalent quarter in 2016. Price changes reported by carriers still averaged less than1% for the 10th consecutive quarter, following a moderating trend in price increases that began in the first quarter of 2013.


Data for two lines, workers compensation and directors and officers liability, indicated material price decreases in the fourth quarter, underscored by larger price decreases than the prior quarter for workers compensation, in contrast to most other lines. Commercial property prices, which had been showing decreases for much of the recent past, now indicate increases in the low single digits. The outlier in the results continues to be commercial auto, where meaningful price increases are again reported and are nearing double digits. Price changes were positive across all account size segments, as large accounts moved from modest reductions to modest increases in aggregate.


“Last year’s weather disasters were some of the most financially disruptive in history, and the survey results indicate we’re likely now seeing the initial response to the catastrophes on the pricing side of the property market,” said Pierre Laurin, Americas Property & Casualty (P&C) sales and practice leader for Insurance Consulting and Technology, Willis Towers Watson. “Further, commercial auto rate increases show no signs of abatement, as insurers seek to restore the line to a profitable rate level.”


CLIPS is a retrospective look at historical changes in commercial P&C prices and claim cost inflation. Separately, Willis Towers Watson issues a forward-looking analysis of commercial P&C trends, outlook and rate predictions through its Marketplace Realities series.


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