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IVANS Index shows increase in average premium renewal rates in Q4

27th January 2023 - Author: Jack Willard

IVANS, a division of Applied Systems, has reported an increase in the average premium renewal rate change across all major commercial lines of business year over year, in the fourth quarter of 2022.

increaseAll lines experienced an increase except for Workers’ Compensation which remained negative.

Commercial Auto, BOP, General Liability, and Commercial Property all ended the year with their highest average premium renewal rate change.

IVANS noted that in 2022, the average premium renewal rate change was higher for most lines of business compared to 2021, with Umbrella and Workers Compensation being the exceptions. Commercial Property average premium renewal rate change was consistently higher compared to all other lines of business in 2022.

Commercial Auto, premiums averaged 5.62% for the quarter and ended the year with 6.13% in December, which was also the quarter high. The quarter low was in October at 5.12%.

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Business Owner’s Policy (BOP) averaged 7.01%, which represented an increase over Q3’s average of 6.45%. BOP premium renewal rate change finished the quarter at 7.23% in December. The Quarter low came in November at 6.66%.

Moving to General Liability, Q4 premium renewal rate change increased from Q3, averaging 5.49% relative to 5.01%. The quarter average premium renewal rate change reached its low of 5.24% at the start of the quarter in October and ended the year in December with the quarter high of 5.71%.

Additionally, Commercial Property Q4 premium renewal rate change rose quarter over quarter, with an average rate change of 7.95%, compared to 6.95% in Q3. Average premium renewal rate change for the line reached its high for 2022 in December at 8.38%. The quarter low was in October at 7.55%.

Umbrella averaged 4.94% compared to 5.21% in Q3. The lines average premium renewal rate change reached its quarter low in October at 4.44% and its high in December at 5.35%.

And finally, Workers’ Compensation averaged 1.48%, down from Q3’s average of -1.08%. Workers’ Compensation began the quarter with its high at -1.01% in October and hit its low in November at -1.77%.

“2022’s hard market was reflected in this year’s Ivans Index, showing continued elevation in average premium renewal rates consistently across most major commercial lines,” said Kathy Hrach, vice president of Product Management, Ivans.

“Built from the industry’s largest data set, the Ivans Index continues to deliver premium renewal rate insights for the benefit of the entire industry as we navigate ways to best support clients and maximize business profitability.”

The IVANS index is released on a monthly basis as a data-driven report of current conditions and trends for premium rate renewal change of the most placed commercial lines of business across the insurance sector.

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