HARTFORD, Conn., Jan. 30, 2017 /PRNewswire/ -- The commercial automobile insurance line has been suffering for five years, and has yet to show significant improvement, despite insurer efforts, according to a new study by Conning.
"Underwriting results for the commercial automobile insurance market are the worst in the industry in recent years," said Jerry Theodorou, a Vice President, Insurance Research at Conning. "The downturn in performance that began in 2011 was abrupt, and was followed by rate increases, attempts at improved underwriting, and pullbacks from the line or its segments by major insurers. However, these actions have yet to result in significant improvements for the industry."
The Conning study, "Commercial Automobile Insurance: Fix Me, Please" reviews the drivers of commercial automobile insurance's recent results, analyzes the issues that led to the troubled market performance, and explores what it will take to restore profitability to the line.
"While the commercial automobile insurance industry has suffered as a whole, the top quintile of large insurers outperformed the bottom by almost 30 points in combined ratio over the past decade," said Steve Webersen, Head of Insurance Research at Conning. "As we analyzed insurer performance metrics and market conditions, it became clear that despite the precipitate deterioration in performance, there were actually many factors that combined to overwhelm the line. Leading insurers have begun to undertake a variety of corrective approaches: from selective withdrawals of difficult market segments, to exploiting enhanced data sources and analytics and technologies, to rethinking rating basis, and more. Looking forward, success in commercial automobile insurance will clearly demand increased sophistication from insurers."
Conning (www.conning.com) is a leading global investment management firm with almost $109 billion in global assets under management as of December 31, 2016.* With a long history of serving the insurance industry, Conning supports institutional investors, including pension plans, with investment solutions and asset management offerings, award-winning risk modeling software, and industry research. Founded in 1912, Conning has offices in Boston, Cologne, Hartford, Hong Kong, London, New York, and Tokyo.
*As of December 31, 2016, represents the combined global assets under management for the affiliated firms under Conning Holdings Limited, and Cathay Securities Investment Trust Co., Ltd. ("SITE"). SITE reports internally into Conning Asia Pacific Limited, but is a separate legal entity under Cathay Financial Holding Co., Ltd. which is the ultimate controlling parent of all Conning entities.
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