This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Commercial Insurance Prices Increase For The Eighth Straight Quarter

Commercial insurance prices rose by almost 7% in aggregate during the fourth quarter of 2012, marking the eighth consecutive quarter of price increases and the fourth showing increases across every line surveyed, according to the latest Commercial Lines Insurance Pricing Survey (CLIPS) conducted by Towers Watson (NYSE, NASDAQ: TW), a global professional services company. The survey compared pricing data reported by carriers on policies underwritten during the fourth quarter of 2012 to those charged for the same coverage during the fourth quarter of 2011.

Although commercial insurance prices continued their year-over-year upward trend, movements from the prior survey were slight, indicating a pause in the acceleration observed since the start of 2011. These price change indications were generally consistent with price increases from the prior survey, except for specialty lines, where the survey indicated somewhat larger gains than were reported in the third quarter.

Workers compensation and employment practices liability had the largest price increases year over year, both approaching double digits. For most commercial lines, increases were reported to be in the mid-to upper-single digits, with all lines of business surveyed showing increases of at least 3%. Standard commercial accounts of all sizes saw rising prices, with larger gains observed in mid-market and large accounts. Specialty lines prices rose at a slower rate than standard lines prices.

Historical loss cost changes reported by participating carriers pointed to an improvement of almost 4% in loss ratios in accident-year 2012 relative to 2011 (excluding catastrophes), as earned price increases continued to more than offset reported claim cost inflation. This indication is a reversal from the estimated 3% deterioration between 2010 and 2011. Carriers reported claim cost inflation estimates of 1% for 2012, which is the second-lowest inflation estimate reported since the launch of CLIPS in the summer of 2005.

“Price increases taken in 2012 will push 2013 loss ratios down, assuming moderate loss inflation,” said Tom Hettinger, Towers Watson’s Property & Casualty sales and practice leader for the Americas.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,098.45 +18.88 0.11%
S&P 500 2,003.37 +6.63 0.33%
NASDAQ 4,580.2710 +22.5760 0.50%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs