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Member, Beacon International Group, Ltd.
Commercial insurance pricing remained flat during the fourth quarter of 2009 after nearly five years of decreases, according to findings from Towers Watson’s recent commercial lines insurance pricing survey.
The latest data suggests that the soft market has stabilized, with companies showing pricing discipline across the commercial insurance market throughout 2009, Towers Watson said, noting that aggregate price change indications showed little differentiation by account size and pricing was nearly flat for all segments.
Those lines that did see small price increases were offset by price reductions in workers compensation and employment practices liability segments, the consultant noted.
New York-based Towers Watson’s survey compared prices charged on policies underwritten by 36 participating insurance companies during the fourth quarter of 2009 with pricing for the same coverage during the prior-year period.
The commercial lines insurance pricing survey indicates that loss ratios for the accident year 2009 deteriorated three percentage points compared with 2008.
“Longer-term inflationary pressure, due in large part to financial crisis bailouts, may lead insurers to exhibit more discipline in their pricing,” Bruce Fell, Towers Watson senior consultant and leader of the company’s property/casualty insurance practice in the Americas, said in a statement. “They’re looking ahead in the event that inflation starts to negatively and dramatically impact loss reserves and loss costs.”