With the composite rate for US P&C insurance increasing slightly from 3.9% in Q1 to 4.36% in Q2, Richard Kerr, CEO of Novatae Risk Group, noted that “there was no significant movement in rates for any coverage or industry group” given that insurers are comfortable with pricing.
Kerr’s comments come as part of MarketScout’s (acquired by Novatae Risk in 2022) most recent Q2 report.
“Insurers are comfortable with their pricing, and as a result, there was no significant movement in rates for any coverage or industry group,” said Kerr, adding, “We are at the beginning of hurricane and wildfire season, so property rates could change based on these potentially catastrophic events. But for now, all is steady.”
Looking at pricing per coverage class, Commercial Property was up 7%, Business Interruption was up 5%, BOP was up 5%, Inland Marine was up 4.7%, General Liability was up 4.7%, Umbrella/Excess was up 4.7%, Commercial Auto was up 8%, Workers’ Compensation was flat at 0%, Professional Liability was up 3.7%, and D&O Liability was up 3.3%.
Elsewhere, the average rate increase for personal lines coverage in the US rose from 4.75% in Q1 of 2024 to 7.6% in Q2.
On this, Kerr commented, “Some homeowners insurers are increasing rates because they feel the exposure reported is less than the replacement cost, thereby resulting in generally higher claims than anticipated.
“Building materials are more expensive due to inflationary pressures, so claim payments are larger than anticipated.
“Auto insurance rates are up because of increased repair costs and higher-than-expected liability claims.”
