Reflecting little change from the second quarter of 2018, third-quarter composite rates for commercial and personal lines were up +2.5% and +2%, respectively, according to the latest quarterly MarketScout pricing survey.
In commercial lines, “rates continue to move slowly upward as insurers take a measured approach to price increases,” says Richard Kerr, MarketScout CEO. Not so in transportation and commercial auto, however, where steep rate increases persist: Both trucking and commercial auto risks clocked average hikes of +6% in the third quarter.
Compare that to average general liability rate increases, for example, which went from +1% to +3%. “Clearly, insurers feel [commercial auto and trucking] exposures are tough and merit aggressive rate increases,” Kerr says. “Moreover, the market is accepting the increases because of the small number of insurers willing to write commercial auto and trucking risks.”
Property and business interruption rate increases moderated a percentage point each between the second and third quarters, while average surety pricing went from +1% to flat. The only commercial lines market to register a rate decrease was workers comp, where pricing fluctuations held steady at an average of -3%.
In personal lines, rate increases for homes valued under $1 million increased a percentage point between the second and third quarter, while rate increases for homes valued over $1 million decreased a percentage point. Personal auto rates moderated from +4% to +3%, and personal articles rates held steady at +1%.
“It appears insurers may feel 2017 was a somewhat unusual year as respects to large cat losses,” Kerr explains. “While rates are still trending upwards, there is no momentum for more aggressive rate increases at this time.”
Jacquelyn Connelly is IA senior editor.