...Continued Underwriting Losses: The commercial automobile insurance segment reported a third consecutive year of underwriting losses with a 2013 combined ratio of 106%. Results in this key segment differ from trends in other segments as the property/casualty (P/C) industry aggregate posted a significant 2013 underwriting gain, the market's best year since 2007. Loss Reserve Deterioration: Commercial auto loss reserve experience has been unfavorable for the last two years, with particular weakness seen in the 2010-2012 accident years. Underwriters point to heightened loss severity and emerging losses from program accounts as primary sources of development. Economic and Competitive Factors: The commercial auto market's premium base shrank considerably in the previous economic recession and soft commercial lines market phase. Pressure to retain business led to price deterioration and erosion of underwriting standards. While premium growth has improved, a slower economic recovery continues to...
