IVANS, a division of Applied Systems, has reported that average premium renewal rate changes across 2020 were “variable” for all lines of business when compared with the previous year.
The Q4 results of the IVANS Index show an increase in the premium renewal rate change average across General Liability, Commercial Property, Umbrella and Workers’ Compensation compared to Q3.
However, Workers’ Compensation average premium renewal rate change remained in negative territory, which was consistently negative throughout all of 2020.
Notably, Commercial Property and Umbrella ended the year with their highest average premium renewal rate change, and Commercial Property rate changes averaged consistently higher compared to all other lines of business in 2020.
In Q4, Commercial Property rates increased by 5.62%, compared to 5.30% in Q3. Renewal rate changes for this line reached a 2020 peak of 5.68% in December.
Commercial Auto premiums, meanwhile, averaged 4.46% for the quarter and ended the year at 5.03% in December, which was also the quarter high. The quarter low was in November at 3.93%.
BOP averaged 4.57%, representing a decrease over last quarter’s average of 4.76%, and finished the quarter at 4.64% in December.
Turning to General Liability, Q4 premium renewal rate change increased from Q3, averaging 3.47% relative to 3.44%. Rates reached a quarterly low of 3.38% at the start of the quarter in October and ended the year in December with the quarter high of 3.59%.
Umbrella averaged 3.46% versus 3.09% in Q3 and reached its quarterly low in November at 2.82% and its high in December at 3.79%.
And finally, Workers’ Compensation averaged -2.13% in Q4, up from the Q3 average of -2.41%, ending the year in December at its quarterly high at -1.70%.
“While we saw variable changes for all lines of business in 2020, average premium renewal rates for Q4 trended higher than those of Q3, with the exception of BOP which increased and Commercial Auto which remained virtually the same,” said Kathy Hrach, vice president of Product Management, IVANS Insurance.
“As we make our way into 2021, IVANS Index will provide insights on how the macroeconomic trends of the ongoing pandemic and policy changes will impact the insurance industry, providing actionable intelligence for agencies and insurers on policy and renewal conversations and pricing strategies.”
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.