WTW: US commercial prices up again
US commercial insurance prices grew again in the first quarter of 2024, according to WTW’s latest Commercial Lines Insurance Pricing Survey (CLIPS).
CLIPS compared prices charged on policies underwritten during the first quarter of 2024 with those charged for the same coverage during the same quarter in 2023. The aggregate commercial price change reported by carriers spiked upward to nearly and above 10% in the second through fourth quarters of 2020. Since then, it started to decline and decreased to just below 5% in the fourth quarter of 2022 but increased back to above 5% in the first quarter of 2023. Now in both the fourth quarter of 2023 and the first quarter of 2024, it is above 6%.
Data for nearly all lines continue to indicate moderate to significant price increases in the first quarter with the exception of workers compensation, directors' and officers' liability, and cyber. CLIPS continues to indicate a slight price reduction for workers compensation. Directors' and officers' liability saw another quarter of price decrease but, again, less than the prior quarter.
The largest price increase came from excess/umbrella liability, which saw a reported price increase near or above double digits for the 20th consecutive quarters. The second largest price increase came from commercial property, which continued to see a double-digit price increase; however, it was slightly lower than the prior quarter. Commercial auto liability continued to report a double-digit price increase but lower than the prior quarter. Cyber reported significant rate increases in 2021 through the third quarter of 2022. From the first quarter of 2023, cyber started to show significant rate decreases, which continued through the first quarter of 2024; however, the latest quarter is showing a slowdown in its rate decrease, with a lower rate decrease than the prior quarter.
When comparing account sizes, reported the prior increases for small, mid-market and large accounts were all slightly lower than prior quarter. Specialty lines essentially had a flat rate change, where professional liability and employment practice liability generally showed rate increases offset by rate decreases experienced in directors and officers.
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