Insurers Drive Up Prices for U.S. Businesses - ABI

U.S. companies are paying more for insurance, a reversal after years of flat or declining rates for property and liability policies, the Wall Street Journal reported. Insurers have raised prices aggressively in the past year on companies of all sizes across the country. And they have warned price hikes are likely to continue. Pretax operating income for the U.S. property-casualty insurance industry fell by 8 percent from 2014 to 2018, even as revenue from insurance premiums grew, according to ratings firm A.M. Best. Excluding investments and other income, the industry lost money from underwriting in 2016, 2017 and 2018. A retreat from some accounts and lines of business by two major insurance players, American International Group Inc. and Lloyd’s of London, has also helped drive prices higher, according to brokers and underwriters. Prices on nearly every type of insurance are rising, according to insurers and brokers. An exception is workers’ compensation, which is highly regulated by states. Excluding workers’ compensation, rates for property-casualty insurance sold to businesses rose 6.7% from a year earlier on average in the first three quarters of 2019, on track for the highest annual increase since 2003, according to brokerage Willis Towers Watson.

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