MarketScout reports that U.S. commercial insurance premiums rose 3.9% in the first quarter of 2024, driven by growth in cyber, auto and property insurance.
U.S. commercial insurance premiums are expected to rise a modest 3.9% overall in the first quarter of 2024, down sharply from a 5.6% surge in the fourth quarter of 2023, according to a MarketScout report.
The first quarter of 2024 saw a shift in the commercial insurance industry, with rates increasing at a slower pace compared to the previous quarter. This was especially evident in January and February, when rates rose more slowly, before rising more sharply in March, said Richard Carr, CEO of Novatae Risk Group, parent company of MarketScout.
Cyber liability lines saw the largest increase during the quarter, up 7 percent, followed by commercial auto lines at 6.7 percent. Property and umbrella liability lines each saw rates increase by 6.3 percent. Meanwhile, workers' compensation lines saw rates remain steady during the quarter, the report noted.
The data, supported by a fee survey conducted by the National Federation for Insurance Education and Research, also broke down the fee increases by account size: Small accounts up to $25,000 and very large accounts over $1 million saw a 4.3% increase, mid-size accounts between $25,001 and $250,000 saw a 3.7% increase, and large accounts between $250,001 and $1 million saw a 5% increase.
By industry, the transport sector had the highest growth rate at 6.7%, followed by the residential sector at 5% and the contracting sector at 4.3%. The public sector and energy sector both increased by 2.7%.
“Property insurers are concerned about the 2024 catastrophe season,” Carr commented. “Liability insurers are relatively calm, but economic conditions and estimates of claims that have been incurred but not yet reported could affect premium rates in the second half of 2024.”
These figures reflect insurers remaining cautious due to potential catastrophe risks and impending liability developments, and highlight the changing landscape for U.S. commercial insurance rates.
See the full MarketScout report here: