Insurance Services Office Inc., which provides information about property/casualty insurance risks to the industry, received the Insurance Department’s permission to lower commercial property and liability rates by an average of 5.3 percent statewide.
Although ISO doesn’t write any coverage, private insurance companies generally follow ISO’s rate filings, Donelon said.
“So it will result almost across the board in a reduction of about 5 percent,” Donelon said. “Individual companies, when they factor in their loss experience, catastrophe models and other factors may deviate somewhat because of that.”
The major factor in lowering rates was the fact that Louisiana didn’t get hit by any hurricanes last year, Donelon said. In addition, the softening insurance market is increasing competition for business.
“When one company lowers premiums to get more market share, it has a ripple effect,” Donelon said.
According to ISO’s filing, retailers should see the biggest reduction in property and liability rates at 10.6 percent. ISO’s filing also calls for an 8.8 percent reduction for members of the service industry and 7.3 percent for industrial and processing companies.
ISO spokeswoman Sarah Malinowski said all of the company’s filings are advisory. “Participating insurers may decide to adopt particular filings, not adopt them, delay adoption, or modify a particular filing,” she said.