Year over year, liability direct premiums written in the first quarter increased to $12.37 billion from $10.39 billion. Direct premiums written by the business line totaled $7.81 billion in the first quarter of 2018. With commercial auto physical damage, total commercial auto direct premiums written in the United States for the first quarter totaled $15.65 billion. In the first quarter, the loss ratio for total commercial auto was 64.1 percent, compared to a loss ratio of 61.2 percent for the liability portion only in the prior-year period.
Beginning in 2022, commercial auto figures will include physical damage within the business line, as information is now broken out within quarterly regulatory statements. Prior periods included both personal and commercial auto, with personal auto accounting for the majority of premiums.
The Progressive Corporation's first-quarter direct premiums written for commercial auto liability increased 36.3 percent year on year to $2.31 billion. The company wrote a total of $2.84 billion in commercial auto direct premiums, including $531.2 million in commercial auto physical damage direct premiums. Progressive had a 68.8 percent direct loss ratio.
According to the insurer's most recent Form 10-Q, written premium per policy for new commercial auto business increased 18% during the first quarter and renewal business increased 20% compared to the same period in 2021. According to the company, the increases are the result of more vehicles per policy and a shift in business mix toward higher premium coverage.
Loss Ratios
Except for Zurich Insurance Group AG, almost all of the largest commercial auto insurers in the United States had loss ratios below 70%.
In an earnings call, CFO George Quinn stated that throughout "this difficult phase of the commercial market," the company has maintained a distinct preference for taking rate on known risks and remains cautious about new risks or risks that "shuffle around the market."
"The market is continuing to bring us quite a better growth through rate," Quinn added.
The Travelers Cos. Inc. is a distant second in terms of market share, with $828.3 million in direct premiums written. Farmers Insurance Group of Companies increased its liability direct premiums written by 117.6 percent to $670.3 million, propelling the company into the top three. Farmers Insurance wrote $722.9 million in commercial auto insurance.
Loss ratios for travelers and farmers were 60.0 percent and 69.5 percent, respectively.
In an earnings call, Travelers CFO Dan Frey stated that the company's loss ratio was "a point better" in the first quarter, owing to earned pricing being higher than what Travelers is seeing in the loss environment.