IVANS, a division of Applied Systems, has released the Q4 and full-year results of its insurance premium renewal rate index, which show that premium renewal rates for most major commercial products reached new highs in December.
The fourth quarter results showed an increase in the average premium renewal rate change across all major commercial lines of business year over year.
However, Workers’ Compensation average premium renewal rate change remained in negative territory, as it did throughout all of 2021.
Compared to the prior quarter, Q4 experienced an increase in average premium renewal rate change across all major commercial lines of business.
Specifically, Commercial Auto lines saw average premium renewal rate increases of 4.69% for the quarter and ended the year with 4.55% in December, which was also the quarter low. The quarter high was in November at 4.89%.
Next, recorded rate change for BOP was 5.58%, representing an increase over last quarter’s average of 5.05%. BOP premium renewal rate change finished the quarter at 5.77% in December.
General Liability Q4 premium renewal rate change increased from Q3, averaging 4.41% relative to 4.21%. The quarter average premium renewal rate change reached its low of 4.18% at the start of the quarter in October and ended the year in December with the quarter high of 4.78%.
Commercial Property lines also rose quarter over quarter, with an average rate change of 5.95% as compared to 5.77% in Q3. Commercial Property average premium renewal rate change reached its high for 2021 in December at 6.14%.
Umbrella averaged 5.13% versus 4.85% in Q3, reaching its quarter low in November at 4.97% and its high in December at 5.40%.
And finally, Workers’ Compensation average premium renewal rate change for the quarter reached -1.16%, up from the Q3 average of -1.40%, beginning the quarter with its low at -1.57% in October and reached its high in November at -0.75%.
Notably, BOP, General Liability, Commercial Property and Umbrella ended the year with their highest average premium renewal rate change.
IVANS also observed that Commercial Property premium renewal rate change averaged consistently higher compared to all other lines of business in 2021.
“Most major commercial lines of business ended the year with their highest average premium renewal rates since the IVANS Index began in 2017,” said Kathy Hrach, Vice President of Product Management, IVANS Insurance.
“As the average premium renewal rate changes become influenced by macroeconomic trends, like inflation and economic uncertainty, we will continue to track how these commercial lines of business fair in 2022.”