Policyholders in the U.S. personal lines market experienced a composite average rate increase of 5.6 percent in the first quarter of 2021 as compared to 6.3 percent in the last quarter of 2020.
“While rates moderated slightly, the market continues to harden for homeowners in Florida and California,” said Richard Kerr, CEO of MarketScout. “Insurers are cutting back and homeowners are paying the price.
If you own a CAT exposed home in Florida or in a wildfire prone area in California, the rate increases can be as much as 25 to 30 percent,” Kerr said.
Automobile and personal articles rates were up 5.3 percent on average in the first quarter.
Rates for homeowners coverage for homes valued at under $1 million were up 5.0 percent, while rates for homes valued at more than $1 million were up 6.7 percent.
Commercial property/casualty insurance rates rose 7.0 percent on average in the first quarter of 2021, but some lines saw significantly steeper hikes, according to insurance exchange MarketScout Corp.
Umbrella and excess liability insurance rates rose the most at 14.0 percent, followed by directors and officers liability at 11.6 percent; professional liability, 11.3 percent; commercial auto, 8.7 percent, and commercial property, 8.6 percent, according to a report released April 6.
No lines experienced rate decreases. The smallest increases were in workers’ compensation and surety, which both saw 1.7 percent increases.
Large accounts saw the biggest increases, up 8.3 percent on average, compared for 6.3 percent for small and midsize accounts.
By sector, transportation policyholders were hit the hardest with 11.7 percent rate increases on average, followed by habitational risks at 9.3 percent.
National Alliance for Insurance Education and Research conducted pricing surveys used in MarketScout’s analysis of market conditions. These surveys help to further corroborate MarketScout’s actual findings, mathematically driven by new and renewal placements across the United States.