US Commercial Insurance Prices Pick Up Significantly

US commercial insurance prices increased by nearly 4 percent in the second quarter of 2019 compared to prices charged during the second quarter of 2018, according to Willis Towers Watson's latest Commercial Lines Insurance Pricing Survey (CLIPS). This represents a significant pickup from increases of close to 2 percent for each of the previous five quarters.

Prices for most lines showed increases, with property, excess/umbrella, and directors and officers (D&O) approaching double digits for the first time in several years. Commercial auto, the past outlier in the results, saw reported price increases near or above double digits for the seventh consecutive quarter. Price changes trended upward for all account sizes, though more significantly for midmarket and large accounts.

"After so many quarters of modest increases, we are seeing a pickup, backing up general market sentiment," said Alejandra Nolibos, senior director, Insurance Consulting and Technology business, Willis Towers Watson. "Adverse loss trends in auto and D&O and deteriorating or potentially deteriorating loss trends in other casualty lines, together with the prospect of potentially diminishing reserve releases, seem to have pushed insurers to demand higher prices."