The Council's Q2 2020 P/C Market Survey captured the collision of a pre-existing hard market cycle with the COVID-19 pandemic, producing significant premium increases across nearly all commercial lines. The pandemic introduced unprecedented uncertainty around business interruption, event cancellation, and workers' compensation, driving carriers to restrict capacity and raise rates. The survey results highlighted the extraordinary complexity brokers faced in mid-2020 renewals.
EXECUTIVE SUMMARY
The following are key takeaways from The Council of Insurance Agents & Brokers’ Commercial Property/Casualty Market Report Q2 2020 (April 1 – June 30):
- The market continued to harden in Q2 2020, with premiums increasing by an average of 10.8% across allsized accounts, marking the 11th consecutive quarter of increased premium pricing across all-sized accounts. As with the previous quarter, large and medium-sized accounts were hardest hit, recording average increases of 14.2% and 11%, respectively, while small accounts experienced an average increase of 7.3%.
- All lines of business, including Workers Compensation, experienced slight-to-significant premium increases in Q2 2020. Umbrella and D&O premiums increased by far the most in Q1 2020, at 20.0% and 16.8%, respectively. Notably, this marked the end of 21 quarters of decreasing prices for Workers Compensation.
- While premium pricing for Commercial Auto continued to increase in Q2 2020, at 9.6%, the same as last quarter, the number of claims for that line continued to fall. Only 14% of respondents said they saw an increase in Commercial Auto claims, while vastly more (55%) said that they saw a decrease in claims.
- The impact of COVID-19 was even more apparent in Q2 2020 than in Q1. Ninety-four (94%) percent of respondents said they saw an increase in Business Interruption claims, and the line saw an average premium increase of 9.7%.
- The market continued to harden in Q2 2020, with premiums increasing by an average of 10.8% across allsized accounts, marking the 11th consecutive quarter of increased premium pricing across all-sized accounts. As with the previous quarter, large and medium-sized accounts were hardest hit, recording average increases of 14.2% and 11%, respectively, while small accounts experienced an average increase of 7.3%.
- All lines of business, including Workers Compensation, experienced slight-to-significant premium increases in Q2 2020. Umbrella and D&O premiums increased by far the most in Q1 2020, at 20.0% and 16.8%, respectively. Notably, this marked the end of 21 quarters of decreasing prices for Workers Compensation.
- While premium pricing for Commercial Auto continued to increase in Q2 2020, at 9.6%, the same as last quarter, the number of claims for that line continued to fall. Only 14% of respondents said they saw an increase in Commercial Auto claims, while vastly more (55%) said that they saw a decrease in claims.
- The impact of COVID-19 was even more apparent in Q2 2020 than in Q1. Ninety-four (94%) percent of respondents said they saw an increase in Business Interruption claims, and the line saw an average premium increase of 9.7%.
Click here for the Q2 2020 P/C Market Report.
Click here for the Q2 2020 COVID-19 Supplement.
The Council relies on data from broker members to create this report. To participate in future surveys or for questions/comments, please contact The Council’s Zach West at [email protected].
