Commercial insurance prices in the first quarter of 2015 increased 2% in aggregate compared with the first quarter of 2014, Towers Watson & Co. said Monday in a new report.
The consultancy’s most recent commercial lines insurance pricing survey showed low single-digit price increases for most insurance lines, with pricing for large accounts increasing at a lower rate than small and mid-market accounts.
Commercial property prices, however, continued to show “small but stable price decreases,” said the survey.
Commercial auto and employment practices liability reported the largest increases, although prices for employment practices liability continue to drop, the survey showed.
Insurers reported an improvement of 2% in loss ratios in accident-year-to-date 2015 relative to the same period in 2014, as earned price increases continue to offset reported claim cost inflation for many lines.
This builds on the estimated improvement of nearly 2% between 2013 and 2014.
“Price increases are barely offsetting loss cost inflation in some lines; we may start to see pressure on the bottom line as reserve redundancies dry up,” Alejandra Nolibos, a director with Towers Watson’s property/casualty insurance practice, said in the statement.
The latest survey included data from 44 insurers representing approximately 20% of the U.S. commercial insurance market, according to the statement.
U.S. property/casualty insurers fourth quarter 2014 net income dropped 13.8% from that of the same period a year earlier, according to an analysis released Tuesday by Verisk Analytics' ISO unit and the Property Casualty Insurers Association of America.