A new report from MarketScout revealed that the composite rate for personal lines across the United States stood at 4% for the third quarter of 2023. In the same quarter, commercial insurance rates saw an increase of 3.72%, compared to 5% in the second quarter.
During this period, all homes, irrespective of their value, experienced moderate increases in rates, as did automobile and personal article floaters. For commercial, meanwhile, rates for all coverage classifications, except business owners policies (BOP), moderated in the third quarter. BOP rates increased from 3.2% to 5%.
Regarding personal lines, Novatae Risk Group CEO Richard Kerr said that insurers are feeling better about their results, which is reflected in the lower rates. However, what is being perceived as the hottest summer on record is creating “concern for the future.”
A summary of the third quarter 2023 personal lines rates is as follows:
Across industry groups and account sizes in the commercial space, every category experienced a moderation in rates.
“Reinsurers have been tough on insurance company partners the last twenty-four months,” Kerr said. “We see their stance moderating. The enhanced terms are being passed along to insurers and their customers. Higher interest rates also help support reinsurers' results, so that could be a part of the reason for moderating rates as well.”
Kerr also noted that some property underwriters subscribe to the belief of continued rate hikes, partly affirmed by the hottest summer on record in 2023.
A summary of the third quarter 2023 rates by coverage, cyber liability, industry class, and account size are as follows:
A recent report from the Consumer Federation of America (CFA) also sheds light on insurance rate increases, with insights revealed that CEOs for the nation’s top 10 personal insurance line businesses received substantial compensation as prices skyrocketed.
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