Trends in U.S. Commercial Insurance Rates: Insights and Analysis

Understanding U.S. Commercial Insurance Rate Trends

U.S. commercial insurance rates have shown a notable increase of 3.8% in the second quarter of 2025. This figure marks a gradual decline from the more significant increases seen in previous quarters, which recorded rises of 5.3% in the first quarter and 5.6% in the fourth quarter of 2024. These insights come from the latest findings of WTW's Commercial Lines Insurance Pricing Survey (CLIPS), which provides a comprehensive view of premiums for policies underwritten in the second quarter of 2025 when compared to the same period in 2024.

Market Insights from the Latest Survey

The CLIPS survey revealed that insurers have been reporting an aggregate price increase of 3.8% for the second quarter of 2025, down from a 5.9% increase during the equivalent quarter in 2024. This moderation indicates a shift in the market dynamics for commercial insurance, suggesting that while prices are still on the rise, the pace is beginning to slow.

Key Factors Influencing Price Changes

Throughout various lines of insurance, price growth has demonstrated moderation. For instance, certain categories such as workers' compensation and directors’ and officers’ liability have actually experienced price decreases. Furthermore, the commercial property sector has recorded its first price drop after various quarters of consistent price hikes.

Category-Specific Trends

Interestingly, the excess and umbrella liability lines have seen the most significant price increases, whereas commercial auto insurance is maintaining a robust double-digit growth trend. There's a noticeable distinction between small and mid-market accounts which are experiencing slightly lower increases compared to their larger counterparts, where rates continue to rise but at a subdued rate.

Expert Commentary on Current Trends

According to Yi Jing, Senior Director of Insurance Consulting and Technology at WTW, there is a clear moderation in commercial insurance pricing reflected in the latest data. While certain lines are still witnessing price hikes, others have stabilized or even slightly decreased, indicating a more thoughtful growth pattern across the insurance market. This balance between growth and stability appears to create opportunities for businesses to navigate their insurance needs strategically.

Understanding CLIPS and Its Importance

CLIPS serves as a retrospective look into historical changes in Commercial Property and Casualty insurance prices as well as claims cost inflation. For those seeking a forward-looking perspective on commercial P&C trends, WTW offers insightful predictions and analyses through its Insurance Marketplace Realities report series, further enhancing the understanding of evolving market conditions.

About WTW and Its Commitment

WTW (NASDAQ: WTW), is dedicated to delivering data-driven and insight-led solutions across the realm of people, risk, and capital. By harnessing both global views and local expertise from a workforce spanning 140 countries, WTW assists organizations in refining their strategies, bolstering resilience, energizing their workforce, and optimizing performance. WTW collaborates closely with clients to unveil pathways to sustainable success while providing unique perspectives that drive advancement.

Engagement with CLIPS Data

The data from the CLIPS survey reflects both new and renewal business figures sourced directly from carriers active in underwriting the insurance business. Participants in this survey encompass a diverse array of U.S. Property and Casualty insurers, including many of the top companies in the commercial lines category. The most recent survey incorporated contributions from 42 insurers, which together represent around 20% of the U.S. commercial insurance market. This aggregate data is crucial for stakeholders aiming to grasp the pricing evolution in the insurance landscape.

Frequently Asked Questions

What was the increase in U.S. commercial insurance rates in Q2 2025?

The increase in U.S. commercial insurance rates in Q2 2025 was reported at 3.8%.

How does the Q2 2025 rate increase compare to previous quarters?

This increase shows a decline from previous quarters, with increases of 5.3% in Q1 2025 and 5.6% in Q4 2024.

Which insurance lines saw price decreases?

Price decreases were noted in workers' compensation, directors’ and officers’ liability, and cyber insurance lines.

What has been the trend for commercial property insurance pricing?

Commercial property insurance recorded its first price decrease after several quarters of slowing price growth.

How does WTW support organizations regarding insurance strategies?

WTW provides data-driven solutions and works closely with clients to enhance their strategic planning, resilience, and overall performance in managing risk.

About The Author

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