Tag Archives: BOP

Immediate Vault

July P&C Composite Rate Steady, Transportation Increases

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The property and casualty composite rate for July was the same as June’s rate, which was minus 1%, MarketScout reported today, adding that insurers are working to stop the downward trend.

“While insurers continue to grant minor rating concessions, many are pushing for an end to any further rate reductions,” Richard Kerr, CEO of MarketScout said in a statement. In the transportation sector, however, pricing is increasing “on all but the very best accounts. The poor loss experience in transportation has prompted underwriters to demand rate increases and restrict underwriting appetite.” Insureds that are unable to convinceBarometer underwriters they can control losses are left with few options “and ultimately end up paying a much higher rate/premium which impacts their profit margins,” he said.

Kerr continued that insurance buyers in the transportation industry are complaining about the lack of cooperation they are seeing from insurers as they try to manage their risk portfolio. “Business owners and corporate CEOs are concerned their insurance premiums will be larger than what was budgeted therefore negatively impacting net profits,” he said.

He advised these insureds to “allocate capital towards implementing loss control and companywide safety programs. That is how they will get cooperation from their insurers.”

A comparison of June 2016 to July 2016 rates by coverage classification reveals that workers compensation and property coverages were the most aggressively priced at minus 2%. Business interruption, business owners policies (BOP), fiduciary and directors & officers all moderated by moving rates from minus 1% to flat, or no increase. Professional liability rates moved from down 2% to down 1%. Rates for all other coverages were unchanged.
Rates-coverage class

There were no rate adjustments by account size from June to July.
Account size

By industry classification, rates for public entities moved up from minus 1% in June to flat or no increase in July. Transportation accounts were assessed at the largest rate increases from up 1% in June to up 3% in July, according to MarketScout.
Industry class

P&C Market Continues Downward Rate Trend

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Property/casualty insurance buyers are continuing to see flat rates, as all lines of coverage averaged a zero percent rate change, MarketScout reported today.

“The market continues to be trending downward over the last eight months, from October 2014 at plus 1.5% to April 2015 at a zero percent increase,” Richard Kerr, CEO of MarketScout said in a statement. “It’s not dramatic but it is a trend. Coastal property may experience some slight rate increases since we are on the cusp of the wind season. Rates on all other exposures should continue to be quite competitive.”

When measuring rates by coverage classification, automobile coverage was up to plus 2%. Rates for all other coverages remained the same. Business owners policies (BOP), professional liability and D&O coverages decreased in April 2015 by 1% compared to March 2015, according to MarketScout, an insurance distribution and underwriting company.

By account size, rates remained the same for all, except jumbo accounts of more than $1,000,000 premium. These accounts adjusted to a reduction of minus 2% in April 2015, compared with rates in March 2015.

Industry classifications were all reported at a zero rate increase in April 2015 with the exception of transportation, which held steady at a rate increase of plus 1% and habitation, which increased from 0% in March to plus 1% in April, MarketScount said.

Summary of April 2015 rates by coverage, account size and industry class: