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Rate Moderation in Second Quarter 2021

Professional Lines Rate Moderation Leads Way

The composite rate for the second quarter 2021 was 5.9 percent versus 7 percent in the first quarter. Commercial insurance buyers paying $25,000 or less in premium are paying a slightly lower rate at 5 percent versus 6.3 percent in the first quarter. As measured by line of coverage, professional lines rates adjusted significantly at an increase of just 4.3 percent versus 11.3 percent last quarter. There were other slight adjustments in rates as measured by industry group, coverage classification and account size. Property, auto, business interruption, general liability, EPLI, crime and public entity had rate increases from Q1 to Q2 but the overall composite rate index was down. Richard Kerr, CEO of MarketScout profiled the market results by explaining, “We monitor trends. This quarter there was a slight trend towards rate moderation, but this could be an aberration. Let’s see how the rest of the year plays out before we make any predictions about market rates moderating.” Kerr also noted, “We are now entering hurricane season and this fall we will be in wildfire season. Property rates continue to rise and could get even higher.” The 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. A summary of the second quarter 2021 rates by coverage, industry class and account size is set forth below.

By Coverage Class
Commercial Property	Up 9.6%
Business Interruption	Up 7%
BOP	Up 4%
Inland Marine	Up 4.2%
General Liability	Up 6.3%
Umbrella/Excess	Up 11.6%
Commercial Auto	Up 9%
Workers’ Compensation	Up 1%
Professional Liability	Up 4.3%
D&O Liability	Up 11%
EPLI	Up 7%
Fiduciary	Up 2%
Crime	Up 3%
Surety	Up 1.3%

By Account Size
Small Accounts	Up 5.3%
Up to $25,000

Medium Accounts	Up 6.3%
$25,001 – $250,000

Large Accounts	Up 8.3%
$250,001 – $1 million

Jumbo Accounts	Up 6.6%
Over $1 million

By Industry Class
Manufacturing	Up 5.6%
Contracting	Up 6.3%
Service	Up 4.3%
Habitational	Up 8.6%
Public Entity	Up 5.6%
Transportation	Up 11%
Energy	Up 6.3%

For detailed rating analysis or market projections by industry class, coverage or account size, contact Vilma Scott at vscott@marketscout.com.

About MarketScout

Founded in 2000, MarketScout is an insurance distribution and underwriting company headquartered in Dallas, Texas. The company is a Lloyd’s Coverholder and MGA for US insurers with specialty expertise in workers’ compensation, private client solutions, energy, healthcare, fine art, equine, jewelry, professional liability, and many specialty programs. The company owns and operates the MarketScout Exchange, as well as over 40 other online and traditional underwriting and distribution venues. MarketScout is the founder of the Council for Insuring Private Clients (CIPC) and administers the Certified Personal Risk Manager (CPRM) designation in partnership with The National Alliance for Insurance Education & Research. MarketScout is the only insurance organization to receive The National Alliance’s exclusive partnership and endorsement. The company founded the Entrepreneurial Insurance Alliance (EIA) in 2007 to support insurance entrepreneurs and in 2017 founded the MarketScout InsurTech (MIT) venture fund. In January 2018, it launched an Incubator to accelerate start-up MGAs and assume operational functions for existing MGAs and insurers. MarketScout’s company culture and sense of community encourages growth, learning and collaboration. The company has been named as one of the Best Places to Work in Insurance by Business Insurance for nine consecutive years from 2012 to 2020. The company has offices in Alabama, Arkansas, Florida, Illinois, Nebraska, Pennsylvania, South Carolina, Tennessee, Texas, and Washington, DC. California license #0D60423.