Commercial Rates Continue to Spike in August

Commercial insurance pricing continued to rise in August while business owners’ policies saw a lower increase compared to the prior month, according to a report by Ivans Insurance Solutions. Commercial auto saw the largest increase with premium renewal rates increasing 4.49% in August from 4.3% back in July this year.

Commercial property renewal rates went up 4.14% from 4.12% at the beginning of July. Business owners’ policies, on the other hand, went up 4.15%, down from 4.28% the previous month. Umbrella liability rates went up 2.92% from 2.72% the prior month whereas general liability rates went up 2.6% from the 2.2% increase in the month prior.

As premiums liability rates rise throughout the year, the market seems to harden. Every year all lines of business see some sort of increase except for workers compensation, which is down 2.49%. Commercial auto saw an increase of 8.8%, which is the 31st consecutive quarter of premium increases – the highest commercial auto insurance rate increase since 2011.

Commercial property saw an increase as well of 3.3%.  Workers compensation declined significantly with rates going as low as 3.3%. The survey also shows rate increases in cyber coverage, which continued high during the fourth quarter 2018 to first quarter 2019 with about 75% of respondents stating that they had seen a substantial increase.

For the most part, cyber risk and future premium increases are the top concerns of clients throughout the nation. Companies are making more data-based decisions. Cybersecurity specifically protects business data with an autonomous defense system as human intervention has often failed. But it’s becoming tougher to safeguard data and if you don’t do so the future of your business is at risk.

In the cyber line, rates are most likely to be 3%-5% higher with most buyers facing an increase at the high end. Cyber insurance for business will cover your business’ liability for data breach that includes sensitive customer information, such as Social Security number, driver’s license numbers, credit card numbers, and health records. But cyber insurance is often excluded from a general liability policy. This is something you must ask your insurance agent to figure out what’s type of protection or coverage you may need.

So, as the first quarter results for 2019 shows an increase in business owners’ policies (BOP), umbrella and commercial property insurance and premium renewal rates compared to the increases in 2018, business owners should prepare for what’s ahead. Every business is unique and so are the needs of your business. Don’t wait until the last minute to shop for coverage. Remember the future of your business is at risk.