Auto insurance

Erie and Progressive increase commercial auto insurance rates in July

US states employ a variety of rate regulation mechanisms, including pre-approval, modified pre-approval, deposit and use, and use and deposit. Some states do not require explicit regulatory approval before insurers use new rates. This analysis is based on when rate filings are “disposed” by state regulators and does not take into account when these new rates went into effect for new and renewal business. In some cases, a new tariff may have been in effect prior to the month the filing was approved by the regulator.

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According to an analysis by S&P Global Market Intelligence, The Progressive Corp. could see the largest overall increase in commercial auto premiums from rate hikes approved in July.

The largest commercial auto insurer received approval for four rate increases during the month, two of which entered the top five largest increases. The two filings combined represent the majority of the $8.7 million premium increase the group could get from July’s rate hikes.

Erie Insurance top rate increase chart

Erie Insurance Exchange, a subsidiary of Erie Indemnity Co., received approval for what appears to be the most impactful rate hike this month. The 8.5% rate hike is expected to boost the group’s total premiums by nearly $5 million.

The rate increase will affect about 19,600 policyholders in North Carolina starting Dec. 1 for new business and renewals.

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Fewer rate cuts in July

Commercial auto rate increases continue to outpace reductions in July. The month saw just two rate reduction filings, which could lead to written premium reductions of more than $5,000.

Forge Insurance Co. won regulatory approval for the largest rate cut during the period. The 18.8% rate cut was filed “to be more in line with competitors.”

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