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The COVID-19 Pandemic: Opportunities and Implications for Captive Insurance

The COVID-19 Pandemic: Opportunities and Implications for Captive Insurance

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The COVID-19 Pandemic: Opportunities and Implications for Captive Insurance explores the challenges presented by today's business and economic upheaval, as well as the hardening insurance market, and what it means for the captive insurance industry.

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IVANS Commercial Lines Premium Renewal Rates Upward Trend Continues

An increasing circular bar graph with an arrow bouncing up it resting on financial papers
November 08, 2019

IVANS announced the IVANS Index: Premium Renewal Rate Index October 2019 results. Year over year, all lines of business, except workers compensation, experienced an increase in average premium renewal rate. Month over month, October experienced an uptick in premium renewal rate change across half of the commercial lines products, including businessowners policy, umbrella, and workers compensation. Commercial auto and general liability saw a negative change, and there was no change for commercial property in October.

The premium renewal rate change highlights by the line of business for October 2019 include the following.

  • Commercial auto4.33 percent average, down from 4.45 percent in September

  • Businessowners policy (BOP)—4.54 percent average, up from 4.09 percent in September

  • General liability—2.49 percent down from 2.73 percent in September

  • Commercial property—4.35 percent, flat from the prior month

  • Umbrella—2.46 percent average up from 2.35 percent in September

  • Workers compensation—-2.95 percent average, up from -3.23 percent in September

"Year over year, premium renewal rate changes are trending positive, with BOP spiking to make the largest rate increase across any line this year," said Brian Wood, vice president of Data Products Group, IVANS Insurance Services.

IVANS Index, released monthly, is a data-driven report on conditions and trends for premium rate renewal change of the most-placed commercial lines of business in the insurance industry. Based on the analysis of more than 120 million data transactions, the IVANS Index premium renewal rate change measures the premium difference year over year for a single consistent policy. It includes more than 32,000 agencies and 400 insurers and managing general agents, and it reflects premium rate change trends experienced by all agencies and insurers across the US insurance market. IVANS Index is available to agencies and insurers as part of IVANS's "Market Insights."

To derive the change in cost, IVANS uses policies that have the same insured, insurer, product type, policy number, expiration date, effective date, and producing agency. For example, if an insured paid $1,000 for a policy last year and $1,023 this year, IVANS Index would state that there is a premium renewal rate change of 2.3 percent. IVANS Index does not use exposure base change or claims experience. Policies with anomalous exposure changes or claims experience are removed.

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