RIMS Survey: Soft Market Reaching Bottom

NU Online News Service, Aug. 11, 3:02 p.m. EDT

A survey on four commercial lines suggests that the soft market may be bottoming out, according to the Risk and Insurance Management Society, Inc.

The RIMS Benchmark Survey tracked the lines of business— general liability, property, workers’ compensation and directors and officers insurance—during the 2011 second quarter. The survey indicates significant tightening in the price declines that have defined the soft market.

RIMS, in conjunction with the consulting firm Advisen, says during the second quarter general liability, property and workers’ comp all fell by less than 1 percent on average. D&O liability policies renewed 4.5 percent lower.

The survey is based on the policy renewals reported by risk managers.

“Pricing has been fairly stable in three of the last four quarters, but it is too early to declare the soft market over,” says Dave Bradford, Advisen executive vice president and editor-in-chief of the survey, in a statement. “Rates may have stabilized for now, but barring major catastrophe losses, there are few signs of materially higher premiums on the horizon.”

He adds that commercial-property and casualty insurers remain well capitalized and along with the sluggish economy, it “could make it difficult for underwriters to push through rate increases.”

RIMS notes that despite record-setting catastrophe losses for the 2011 first half, the impact “has not been sufficient to trigger widespread premium increases outside of the affected areas.”

Frederick Savage, a member of RIMS board of directors, notes that while buyers still benefit from “a competitive insurance market,” additional catastrophe losses could change that situation “quickly.” Noting this is the middle of hurricane season, a significant loss could spark higher premiums “at least for property risks.”

Comments

Resource Center

View All »

Increase Sales Conversion with this Complimentary White Paper

This whitepaper will share proven techniques - used by many of the industry's top producers...

D&O Policy Definitions: Don't Overlook These Critical Terms

Unlike other forms of insurance where standard policy language prevails, with D&O policies, even seemingly...

Environmental Risk: Lessons Learned from Willy Wonka and the Chocolate...

Whether it’s a chocolate factory or an industrial wastewater treatment facility, cleanup and impacts to...

More Data, Earlier: The Value of Incorporating Data and Analytics...

Incorporating more data earlier in claims lifecycles can help you reduce severity payments by 25%*...

How Many Of Your Clients Are At Risk Of Flood?

Every home is vulnerable to flooding. Learn four compelling reasons why discussing flood insurance with...

Gauging your Business Intelligence Analytics Capabilities and the Impact of...

Big Data, Data Lakes and Data Swamps, How to gauge your company's Big Data readiness....

Extending Contact Center Capabilities Across the Insurance Enterprise

Today advancements in technology are making a big impact on business and society. To yield...

Drug and Alcohol Testing Requirements

In this two-part series, NBIS Risk Management team will break down the requirements to assist...

Why Cyber Liability is Essential for Human Service Organizations

For traditional low-tech operations, information is often compromised in ways that don't involve technology. Access...

A Solution for Large Commercial Habitational Accounts

6 Reasons to place your LARGE Habitational Accounts with Dauntless.

PropertyCasualty360 Daily eNews

Get P&C insurance news to stay ahead of the competition in one concise format - FREE. Sign Up Now!

Advertisement. Closing in 15 seconds.