Commercial property/casualty prices continued their rise and underwriting remained tight in the fourth quarter of 2012, according to the latest quarterly Commercial P/C Market Index Survey from the Council of Insurance Agents & Brokers (CIAB).
Pricing rose on average at a rate of 5.0 percent, compared with 3.9 percent in the third quarter of 2012, across small, medium and large accounts.
Small account pricing realized the biggest increase quarter-to-quarter: 5.5 percent compared with a 3.7 percent increase in the third quarter of 2012.
Council president Ken Crerar noted:
I think you can characterize the fourth quarter as more of the same. Carriers were still cautious about the risks they were putting on their books and pushed for price increases where they could get them.Ã¢â‚¬
The workersÃ¢â‚¬â„¢ compensation market clearly was in distress in the fourth quarter, according to insurance brokers across the country. One Northeast broker said prices escalated 30 to 50 percent, mostly on large accounts. A Midwest broker said some carriers werenÃ¢â‚¬â„¢t particularly interested in writing workersÃ¢â‚¬â„¢ compensation accounts. Others said monoline coverage was harder to find.
Property prone to catastrophes was also tough to write. In the Northeast where Sandy hit hardest, carriers decreased CAT limits such as flood and wind, while increasing deductibles. Brokers reported similar stories for vulnerable property across the country.
The Council said the general feeling of the market last quarter can be summed up this way: underwriters looked carefully at their potential loss exposures and in some cases were willing to walk away rather than get caught short.
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