Cyber Premium Relief Continues While Commercial Auto Struggles for 54th Quarter
Washington, D.C. – The property and casualty (P/C) insurance market has kept a stable trend in the final quarter of 2024, with an average 5.4% increase in the premiums according to The Council’s latest survey, marking the 29th straight quarter of premium growth across the board.
Most businesses saw premium hikes in Q4, with rates like or lower than Q3, except for commercial auto and umbrella. However, cyber insurance saw the largest premium decrease of all lines, 1.8% to be exact. This is because of increased market capacity and heightened competition among different carriers, which are working in favor of business owners. Furthermore, businesses are more focused towards cyber risk management which leads to lower industry-wide loss ratios. This has helped stabilize the market, even though ransomware attacks continue to rise.
Commercial auto, however, remains to be troublesome for insurers – with an 8.9% average premium increase. This is the highest among all lines for the 54th consecutive quarter. With rising claims, the reduced underwriting capacity and worsening loss severity have contributed to the continuously increasing premiums. As reported by AM Best in November 2024, the average loss per commercial auto liability claim has doubled since 2014. The increased commercial use of electric vehicles has gone up 233% from 2019 to 2021. This has contributed to higher costs, as they have unique risks and repair expenses.
As per The Council’s report, the market remained steady overall, as mentioned by one insurance professional from a large Northeastern firm, “Q4 2024 seemed to be a stable quarter.”
