Today’s Insurance Journal arrives with this bit of positive news: while rates for most lines of property and casualty insurance are still soft, work comp premiums are firming, driven in part by increasing rates in California, and for the first time in several years, higher rates in other states as well.
The data come from Towers Perrin’s Commercial Lines Insurance Pricing Survey (CLIPS), which is derived from figures submitted by insurers. That said, the database is rather small as the contributors account for about a fifth of the market. Given the highly competitive nature of the business, I’d be pretty confident these data are indicative of the larger market, as there’s no way a subset of commercial carriers could sustain price increases if other insurers were not increasing rates as well.
Another note of interest from CLIPS; accident year loss ratios continue to deteriorate, with the latest information indicating about a 5% deterioration from 2009 to 2010.
The report follows on the heels of another report indicating the P&C industry’s reserve cushion is getting slightly thinner. Fitch Ratings indicates industry reserves are likely just about ‘adequate’, but this is still reflects a deterioration from previous years.
What does this mean for you?
Work comp rates are firming.
Jun
14
