Renewal rates accelerate across commercial lines in Q3: Ivans
Rate increases accelerated across most commercial lines of business in the third quarter, according to the latest pricing data from Ivans, though commercial auto increases continued to slow.
The latest pricing report from the insurance software and servicing provider showed most lines hit renewal rate lows in July or August before surging toward the end of the quarter.
The results showed a continued trend from its second quarter, which showed broad acceleration in rates across all commercial lines.
The largest increase in Q3 came in umbrella coverage, where premium renewal rate change averaged 4.85%, rising from 4.40% in Q2. The low point in the quarter, 4.73%, came in July, but by the close of the period, it reached a high of 4.95%.
Business owners policies renewed with an average 5.05% increase, up from 4.59% in the second quarter. The quarter began with its lowest rate increase in July at 4.87%, and ended the quarter with its highest rate, 5.18%.
In general liability, 3Q premium renewal rates rose 4.21%, compared with 3.95% a year ago. The low in this line was also seen in July, at 4.17%, and it topped out at the end of the quarter at 5.89%.
In commercial property, the average premium renewal rate change increased to 5.77% for the quarter, from 5.54% in Q2. The quarter premium renewal rate change reached its low of 5.62% in August, then jumped to 5.89% at the end of the quarter.
The increase in commercial auto slowed, a trend that appeared in July. Average premium renewal rate in Q3 was 4.32%, down from the previous quarter’s 4.51%. The quarter’s low came in August at 4.06%, while the period ended with a high of 4.70%.
Workers’ compensation rates continued to fall, but the decline saw improvement over the quarter. The premium renewal rate averaged a 1.4% decline, up from Q2, when it was -1.74%. The quarter premium renewal rate change reached its low of -1.93% in July and ended the quarter at -0.82%.
“The Q3 results of the IVANS Index continues to show we are operating in a hard market,” said Kathy Hrach, vice president of product management for IVANS Insurance, in a statement.
“In fact, Commercial Auto, BOP, General Liability, Umbrella and Workers’ Compensation reached their highest average premium renewal rate of the year in September.”