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P&C rates up through Q4 but increases moderating: MarketScout

6th January 2022 - Author: Matt Sheehan

MarketScout data shows that commercial property and casualty (P&C) insurance rates were up through the fourth quarter of 2021, with the composite rate recorded at 5.8%, versus 6.8% in Q3.

growth chartBy line of coverage, MarketScout found the biggest rate increases in the fourth quarter were for umbrella, property and directors and officers liability.

However, every line of coverage except BOP had the same or a lower increase in the fourth quarter as compared to the preceding third quarter.

Rates moderated for all account sizes with medium sized accounts, at 5.3% in the fourth quarter as compared to 7.3% in the third quarter.

Additionally, all industry classifications were assessed lower rate increases in the fourth quarter with habitational rates moderating the most at an increase of 7% as compared to 9% in the third quarter 2021.

“The fourth quarter 2021 reflects moderation in rate increases,” said Richard Kerr, CEO of MarketScout. “However, when comparing rates for the entirety of 2021, rates did increase from plus 5.6 percent in 2020 to plus 6.6 percent in 2021.”

Turning to personal lines insurance, MarketScout reported that rates were up 4.25% in the fourth quarter of 2021, with homeowners, personal articles, and auto rates all moderating slightly from the third to the fourth quarter.

“The composite national personal lines market continues to steadily adjust rates as necessary without year-over-year massive rate increases,” Kerr continued.

“However, for CAT exposed properties, rate increases can be dramatic; as much as twenty-five to forty percent in areas such as the wildfire corridors of California or Southern portions of Florida.”

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