US Composite Rates Up 4.8 Percent in Second Quarter
- July 09, 2020
Surplus Lines Accounts Up 9 Percent
The US composite commercial property and casualty rates increased slightly from up 4.5 percent in the first quarter 2020 to up 4.8 percent in the second quarter.
According to Richard Kerr, CEO at MarketScout, “Almost all US insurers are assessing rate increases; however, surplus lines insurers are more aggressive as rate increases for the second quarter were up 9 percent. Drilling down even further, cat-exposed surplus lines property accounts averaged rate increases of 12 percent.”
Directors and officers liability rates are moving aggressively upward. "D&O rates were up 9.3 percent in the second quarter. This is a very volatile market. Insureds with claims are seeing rate increases as high as 50 percent,” noted Kerr.
Business interruption rates were up from 4 percent in the first quarter to plus 6 percent in the second quarter, possibly because of the concerns surrounding COVID-19 claims.
By industry group, transportation accounts continue to suffer the largest rate increases at plus 8.3 percent in the second quarter.
The MarketScout Market Barometer tracks rate movement for all industries and coverage classes as well as by the size of the account (measured by premium size).
The National Alliance for Insurance Education and Research conducted pricing surveys used in MarketScout's analysis of market conditions. These surveys help to further corroborate MarketScout's actual findings, mathematically driven by new and renewal placements across the United States.
A summary of the second quarter 2020 rates by coverage, industry class and account size is set forth below.
|By Coverage Class|
|Commercial Property||Up 5%|
|Business Interruption||Up 6%|
|Inland Marine||Up 4.6%|
|General Liability||Up 4.3%|
|Commercial Auto||Up 5.3%|
|Workers’ Compensation||Flat 0%|
|Professional Liability||Up 6.7%|
|D&O Liability||Up 9.3%|
|By Account Size|
|Small Accounts||Up 4%|
|Up to $25,000|
|Medium Accounts||Up 4.6%|
|$25,001 – $250,000|
|Large Accounts||Up 4.8%|
|$250,001 – $1 million|
|Jumbo Accounts||Up 4.3%|
|Over $1 million|
|By Industry Class|
|Public Entity||Up 4.7%|