The Connected Business of Insurance
July 19, 2018
IVANS Index is a data-driven report of current conditions and trends for premium renewal rate change of the most placed commercial lines of business in the insurance industry. Data collected in the IVANS Index enables insurers to determine competitive rates and the most profitable lines of business for investment. To learn more about IVANS Index, read IVANS Index: Get Ahead of Renewal Pricing for Your Clients.
Second Quarter of 2018 Shows General Uptick in Premium Renewal Rate Change
Compared to the previous quarter, the latest results from the IVANS Index show that the insurance industry premium renewal rate change has experienced variable change across nearly all major commercial lines products, including Commercial Auto, General Liability, Commercial Property and Umbrella. There was no change in premium renewal rate change for BOP, and Workers’ Compensation remains the only line of business experiencing a negative rate change.
Highlights from the Q2 2018 results include:
- Commercial Auto: Premium renewal rate change averaged 4.32% for the quarter, ending at 4.38% for June.
- BOP: Quarter premium renewal rate change averaged 4.01%, representing no change over last quarter’s average of 4.00%. BOP premium renewal rate change finished the quarter at 4.14% in June.
- General Liability: The quarter premium renewal rate change reached 2.16% in April and ended the quarter in June at 2.35%.
- Commercial Property: Q2 premium renewal rate change experienced an increase quarter over quarter, with an average rate change of 3.14% as compared to 3.11% in Q1 2018.
- Umbrella: Q2 premium renewal rate change averaged 1.77% versus 1.49% in Q1 2018.
- Workers’ Compensation: Premium renewal rate change slightly decreased in Q2, averaging at -2.49% as compared to -2.47% in Q1 2018.
The latest IVANS Index figures demonstrated slight variance quarter over quarter, with the most significant trend change occurring with General Liability and Umbrella. As the second quarter comes to a close, the IVANS Index shows that the Commercial Lines market continues to harden, providing guidance for agents to advise their clients on policy changes and market intelligence for insurers to support pricing strategies.
General Liability insurance premium renewal rate change for Q2 averaged 2.29% versus 2.01% in Q1 2018, with a six month average of 2.15%. In Q2, May marked the quarter high at 2.37% premium renewal rate change, with the low in April at 2.16%. Retail firms continue to experience higher than average premium renewal rate change across the past six months, most notably in Q2 2018, relative to the average. Six month premium renewal rate change was 4.63%, with a spike in May at 6.25%.
Umbrella premium renewal rate change averaged 1.77% in Q2 versus 1.49% in Q1 2018, with a six month average of 1.63%. Premium renewal rate change reached a quarterly high at 2.31% in April and low at 1.46% in June. Texas experienced higher than average premium renewal rate change in Q2 at 4.25% relative to the national average at 1.77%, with a spike in June at 5.09%.
For further insights into premium renewal rate change across the industry, download the full Q2 2018 IVANS Index report now >
Brian Wood, Vice President of Data Products Group for IVANS, develops innovative and data-driven applications, tools and services for the insurance industry. Prior to this position, he co-founded EvoSure, which was acquired by Applied in Sept 2015. Brian spent 10 years with Marsh & McLennan as Senior Vice President of Strategy and Business Analysis where he developed global insurance distribution platforms. Brian began his career in insurance building the first company to bind insurance online, insuranceOrder.com (a Trilogy company) which was acquired by Marsh & McLennan in 2001.