MarketScout: Commercial Lines Rates Up 5% in September; Personal Lines Up 3%
Commercial-lines rates continued to climb in September, rising by 5 percent compared to the same month a year ago, according to MarketScout’s latest analysis.
In last month’s MarketScout report, the Dallas-based electronic insurance exchange said rates had climbed 5 percent in August 2012 compared to August 2011.
For September, MarketScout says rates for smaller- and medium-size accounts (defined as up to $250,000 in premium) were up 6 percent, while large accounts (between $250,000 and $1 million) were up by 4 percent. Rates for jumbo accounts (over $1 million in premium) rose by 3 percent.
By coverage class, commercial property was the only line to see a lower rate of increase compared to last month’s MarketScout report. In the current report, commercial property rates were up by 6 percent in September compared to September 2011. Last month’s report showed rates in this line up 7 percent in August compared to August 2011.
Four lines of business showed rates increase by one point in September compared to increases reported in August:
· BOP, up 5 percent in August, climbed by 6 percent last month.
· Umbrella and excess rose 4 percent in September, compared to up 3 percent in August.
· Commercial auto rose 5 percent in September, compared to up 4 percent in August.
· Fiduciary was up 2 percent in September, compared to up 1 percent in August.
The MarketScout barometer is another in a steady line of reports indicating a gradual rise in rates. Last week, insurance broker Marsh released its “Global Insurance Market Quarterly Briefing,” which says the cost of insurance for major lines increased by 0.9 percent during the third quarter of this year. The report examined 20 markets globally over a 12-month rolling period. During the quarter, renewal rates rose 1.4 percent, unchanged from the second quarter of this year.
Turning to personal lines, MarketScout says rates were up by 3 percent in September compared to the same month a year ago. Richard Kerr, MarketScout’s chief executive officer says, “High-net-worth homeowners rates were a bit more competitive in September, with a rate increase averaging plus-2 percent as compared to plus-3 percent the prior month.”
Rates for homeowners insured for under $1 million in value saw their rates rise by an average of 3 percent, unchanged from August.
Automobile rates stood at up 3 percent compared to up 2 percent in August.
Personal articles remained unchanged on a month-to-month basis up 3 percent.