Commercial Lines Market Continues To Harden, According to IVANS

IVANS announced the IVANS Index: Premium Renewal Rate Index second quarter results. The outcomes showed a general uptick in premium renewal rate change across the commercial lines of business compared to first quarter 2018, including commercial auto, general liability, commercial property, and umbrella. There was no change in premium renewal rate change for businessowners policy (BOP), and workers compensation remains the only line of business experiencing a negative rate change.

Premium renewal rate change by line of business for second quarter 2018 highlights include the following.

• Commercial auto: Premium renewal rate change averaged 4.32 percent for the quarter, ending at 4.38 percent for June.
• BOP: Quarter premium renewal rate change averaged 4.01 percent, representing no change over last quarter's average of 4.00 percent. BOP premium renewal rate change finished the quarter at 4.14 percent in June.
• General liability: The quarter premium renewal rate change reached 2.16 percent in April and ended the quarter in June at 2.35 percent.
• Commercial property: Q2 premium renewal rate change experienced an increase quarter over quarter, with an average rate change of 3.14 percent, as compared to 3.11 percent in Q1 2018.
• Umbrella: Q2 premium renewal rate change averaged 1.77 percent versus 1.49 percent in Q1 2018.
• Workers compensation: Premium renewal rate change slightly decreased in Q2, averaging at -2.49 percent, as compared to -2.47 percent in Q1 2018.

"The latest IVANS Index figures demonstrated slight variance quarter over quarter, with the most significant trend change occurring with General Liability and Umbrella," said Brian Wood, vice president of IVANS Markets. "As the second quarter comes to a close, the IVANS Index shows that the commercial lines market continues to harden, providing guidance for agents to advise their clients on policy changes and market intelligence for insurers to support pricing strategies."

IVANS Index, released monthly, is a data-driven report on conditions and trends for premium rate renewal change of the most-placed commercial lines of business in the insurance industry. Based on analysis of more than 120 million data transactions, the IVANS Index premium renewal rate change measures the premium difference year over year for a single, consistent policy. It includes more than 30,000 agencies and 380 insurers and managing general agents, and it reflects premium rate change trends experienced by all agencies and insurers across the US insurance market. IVANS Index is available to agencies and insurers as part of IVANS's "Market Insights."

To derive the change in cost, IVANS uses policies that have the same insured, insurer, product type, policy number, expiration date, effective date, and producing agency. For example, if an insured paid $1,000 for a policy last year and $1,023 this year, IVANS Index would state that there is a premium renewal rate change of 2.3 percent. IVANS Index does not use exposure base change or claims experience. Policies with anomalous exposure changes or claims experience are removed.

The complete IVANS Index report is available on the IVANS website.