NU Online News Service, April 5, 3:04 p.m. EDT
Following months of rates stuck firmly in a soft market mud, MarketScout reports the overall composite rate for U.S. property and casualty commercial insurance policies measured minus-4 percent in March after four consecutive months of minus-5 percent.
“We have finally broken out of the doldrums,” says Richard Kerr, CEO of Dallas-based MarketScout, an insurance distribution and underwriting company. “Rates are moving up.”
“Workers’ compensation, property, business interruption, small commercial, general liability and auto rates adjusted in March,” he adds.
Workers’ compensation rates were flat in March. Kerr says rate increases are underway in some states, as one major insurer abandoned the line, and another stopped writing new business in five states while adopting more stringent guidelines for renewals in 10 states.
The composite rate for all U.S. property is down 4 percent, as catastrophe-exposed property risks are receiving rate increases of 2-5 percent, Kerr says.
“After the Japan earthquake and RMS 11 [hurricane model revisions Risk Management Solutions], there has been considerable speculation about property rates,” Kerr says.
Some trends were maintained in March. Kerr says the larger the premium of an account, the more aggressive pricing was. The rate for small accounts was minus-1 percent, while large accounts of $250,000 or more saw rate reductions of 5 percent. Each were consistent with results the month prior.