For the second consecutive quarter, respondents for The Council’s Property/Casualty Market Survey were asked a number of questions related to COVID-19 and how the current pandemic continued to impact the commercial property/casualty market in Q2 2020. It was evident that COVID-19’s impact on insurance accelerated into the second quarter, as the majority of respondents noted increased pricing, decreased carrier appetite, stricter underwriting and an increase in reported claims across key lines of business.
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%.
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