Commercial property-casualty rates continue their slide, with few lines other than property-catastrophe showing any sign of hardening in the first quarter, the Council of Insurance Agents & Brokers said.

The Washington-based association's view is based on its quarterly industry survey of member insurance brokers. A total of 105 brokers responded to the survey covering the first three months of 2006.

The survey found that most brokers see p-c rates either stable or edging downward, continuing 2005's trend in pricing.

CIAB said that based on reports from its brokers, property-catastrophe exposures are seeing increases of more than 25 percent and that Florida property capacity is limited. Coastal wind capacity is quickly drying up, the association added.

By account size, 37 percent of brokers responding said that premium quotes dropped 1-to-10 percent for small accounts (those with less than $25,000 in commission and fees), while 45 percent saw premium drops in that range for medium-sized accounts (between $25,000 and $100,000 in commission and fees), and 40 percent for large accounts (of over $100,000 in commission and fees). The percentages were not significantly different from the 2005 fourth-quarter survey.

In addition, 15 percent of brokers reported premium drops in the range of 10-to-20 percent for small accounts during the first quarter, while 22 percent reported such drops for medium accounts, and 24 percent for large accounts.

However, 16 percent of small accounts saw no change in pricing in first-quarter 2006, compared with 31 percent of accounts seeing no change in the fourth quarter of 2005. There was no quarter-to-quarter change for medium-size (10 percent) and large accounts (9 percent) reporting no change in pricing.

The first-quarter report also appeared to indicate that overall percentage of increases, which ranged from 1-to-100 percent, did not substantially change from the fourth quarter of 2005.

Average commercial rates showed a decrease of 2.7 percent, according to the survey, compared with a 4.6 percent decrease in the fourth quarter of 2005.

Of the five lines of business showing the greatest changes, the survey said commercial property rates increased 2.3 percent, while workers' compensation had the largest decrease at 7.9 percent in the first quarter of this year. In contrast, during last year's fourth quarter, commercial property rates declined 1.0 percent, on average, and workers' compensation rates fell 4.6 percent.

General liability decreased 5.3 percent in first-quarter 2006, and commercial auto decreased 4 percent. Declines were similar in fourth-quarter 2005 at 4.7 percent for GL and 4.2 percent for commercial auto.

In addition, umbrella rates fell more in first-quarter 2006, sliding down 4.1 percent this year, and only 2.0 percent in the final quarter of 2005.

The complete report is available online at www.ciab.com

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CIAB Survey Charts Continued Rate Slide

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