Year-over-Year Premium Increases Continued Across Most Lines in Q2

Premium renewal rate changes for nearly all commercial insurance lines were up year over year during the second quarter of 2023, according to the Ivans Index, a regular premium renewal rate index compiled by the Ivans insurance exchange service.

Ivans second-quarter results showed premium renewal rate changes increasing year-over-year for all major commercial lines except workers compensation and umbrella.

The second quarter saw increases in the average premium renewal rate change for commercial auto, business owners policy (BOP), commercial property, umbrella, and workers compensation compared to the premium renewal rate change in this year's first quarter, while general liability experienced a slight decrease, Ivans said.

Premium renewal rate changes by the line of business during the second quarter include the following.

• Commercial auto. The second-quarter average premium renewal rate for commercial auto averaged 6.50 percent, an increase from the first quarter's average of 5.85 percent. The quarter began with the lowest rate change in April at 6.16 percent and saw its highest rate in May with an average of 6.80 percent.
• BOP. The BOP premium renewal rate increased in the second quarter with an average of 7.56 percent versus 7.12 percent in the first quarter. The quarter's lowest premium renewal rate was in May averaging 7.44 percent, while the highest rate was 7.64 percent in June.
• General liability. The premium renewal rate for general liability experienced a slight decrease in this year's second quarter compared to the first quarter's level, to an average of 5.21 percent from 5.23 percent. The second-quarter premium renewal rate saw its low in May at 4.56 percent and its high in June at 5.58 percent.
• Commercial property. The average premium renewal rate change for commercial property increased in the second quarter by 9.77 percent versus 8.89 percent during the second quarter. The quarter began with its highest rate change in April at 10.09 percent and reached its lowest rate in June at an average of 9.34 percent.
• Umbrella. The average premium renewal rate change for umbrella increased by 5.12 percent in the second quarter versus a 5.08 percent increase in the first quarter. The premium renewal rate change for umbrella saw its quarter low of 4.36 percent in May and its high of 5.92 percent in June.
• Workers compensation. The workers compensation premium renewal rate change averaged a 1.10 percent decrease in the second quarter, up from a 1.36 percent decrease during the first quarter. The premium renewal rate change for workers compensation reached its low for the quarter of a 1.37 percent decrease in May and its high of a 0.71 percent decrease in June.

"The Q2 results of the Ivans Index show that the premium renewal rates continue to increase in line with other pricing trends in the broader macro environment," Kathy Hrach, vice president of Product Management at Ivans, said in a statement. "As we enter the second half of the year, the Index will see how changing regulatory environments and hurricane season impact premium renewal rates and carrier and agent investment in certain lines of business based on profitability opportunity."

The monthly Ivans Index is based on the analysis of data from more than 120 million commercial insurance transactions.