Commercial Lines Rates Increase in Q1, but at Slower Pace
Commercial lines rate increases continued, but slowed in Q1 2015, according to Towers Watsons latest Commercial Lines Insurance Pricing Survey (CLIPS).
Rates overall were up 2% in the quarter compared to the same period a year ago, the survey notes, with increases in most individual lines in the low single digits. Commercial auto and employment practices liability showed the largest increases, according to the survey, although EPLI increases moderated from last year. Commercial property rates continue to show small but stable price decreases in Q1.
CLIPS notes that carriers reported a 2% improvement in loss ratios as rate increases offset reported claim-cost inflation in many lines. But Alejandra Nolibos, a director with Towers Watsons Property & Casualty Insurance practice, notes that price increases are barely offsetting loss cost inflation in some lines; we may start to see pressure on the bottom line as reserve redundancies dry up.