Premium Adequacy & Leakage Sentinel · Brief 01
Rate-Adequacy Command Centre
One slice softening below rate adequacy — Contractors GL average rate scored against the book, monthly, with the connected loss ratio
The one line you configure
Where is booked rate softening below adequacy, and is it already earning into the loss ratio?
In a nutshell
Rate inadequacy is concentrated in one slice: Contractors GL in TX and FL, through RT Specialty and Risk Placement on Nationwide capacity. Average rate softened 3.7 → 3.0 and the connected loss ratio drifted 63% → ~92% in lockstep — inadequate rate earning straight into loss cost. It is the only program in the book still cutting rate.
At a glance
The connected loss ratio — where rate inadequacy has already surfaced
What moved
What · the driver-slice average rate keeps getting cut on the soft months
The rate dips below the band on the recurring soft months (Apr, Jul) then snaps back — a planted, repeating soft-market signal, not one bad month.
Why · every rate cut answers with a loss-ratio spike — the connection
The two series move inversely on the same slice: rate 3.0 lines up with a 92% loss ratio, rate 3.1 with 88% — inadequate rate earning straight into loss cost.
Where · Contractors GL is the only program not taking rate
Share of policies renewing flat or with a decrease. Contractors GL is the only program carrying rate cuts and sits ~10 points above the field on flat renewals — the soft-market outlier.
The leading indicator fired before the headline
The rate softened first; the loss ratio followed a quarter later. Caught now, a targeted re-file fixes it before the program nears the 120% carrier-cancellation line.
So what
Average rate on the Contractors GL TX/FL slice has softened 3.7 → 3.0 and the loss ratio has answered 63 → ~92% in lockstep. File a targeted rate increase on the driver classes now — while it is a ~90s problem, not a 120% one.
The points that matter
Rate is softening on one slice, not the book
Contractors GL in TX and FL through RT Specialty and Risk Placement cut average rate from 3.7 to 3.0.
3.7 → 3.0$/exposure unitThe loss ratio answered in lockstep
The same slice drifted from 63% to ~92% as the rate came off — inadequate rate earning into loss cost.
63 → 92%loss ratioCaught at ~90s, not 120
The leading indicator fired while a targeted re-file still fixes it — before the program reaches the cancellation line.
~92%vs 120% cancelQuestions it already answers
Is the softening the whole Contractors GL book or just this slice?
Just the slice — the program books 68% loss ratio overall; TX/FL through RT Specialty and Risk Placement is the ~92% driver.
If I file a rate increase on the slice, does the loss ratio come back before renewal?
Yes — re-basing rate to ~3.7 on the driver classes pulls the slice back toward the 63% baseline over the next two quarters.
Why is only Contractors GL cutting rate while every other program takes increases?
Soft-market competition on TX/FL contractor risks — it is the one program with rate decreases and the most flat renewals in the book.