The composite rate for U.S. commercial insurance was plus 1 percent in October, according to MarketScout, an insurance distribution and underwriting company. For personal lines, homeowners insurance increased 3 percent in aggregate, regardless of home value. Automobile rates were plus 2 percent, the same as in September. Personal articles rates were plus 1 percent compared to September.
Except for commercial automobile coverage, which increased to plus 3 percent from plus 2 percent, and professional liability, which increased to plus 2 percent from plus 1 percent, measured by coverage, rates were static compared to the month prior. Property and workers’ compensation rates were more competitive, as rates declined 1 percent. By account size, only rates for small accounts changed from the prior month, decreasing to plus 2 percent from plus 3 percent. Rates for all other account sizes remained the same.
“As expected, the U.S. composite commercial rate continues its slow slide,” said Richard Kerr, CEO of MarketScout. “We are almost completely past hurricane season, so we expect continued pressure on property rates. Workers’ compensation rates are also down from last month. However, a few large insurers could be facing some challenges on their comp book. If so, this could moderate the slide in WC premiums."
Only manufacturing and energy risks experienced rate increases, moving to plus 2 percent from plus 1 percent. Contracting, service and transportation declined 1 percent; all other industries were unchanged compared to September.
“Personal lines insurers are going to have a good 2014, despite a large number of micro storms, which resulted in notable claims activities. Rates should remain stable and actually adjust downward a bit more by year end,” Kerr said.
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