The rate of decline in U.S. property and casualty rates, which plummeted 12 percent last month, may begin to slow this year, but decreases will continue, according to an insurance exchange executive.

“We anticipate rate decreases to moderate for the remainder of 2008. However, a lessening rate decrease in 2008 does not mean the soft market is coming to an end,” commented Richard Kerr, chairman and chief executive of MarketScout, in revealing the 12 percent average commercial insurance rate decline for March.

“The soft market began in February 2005, so after 36 months, rate reductions will naturally moderate. For instance, including the March 2008 reduction of 12 percent, rates are down almost 30 percent from March 2005 to March 2008,” said Mr. Kerr in a statement.

He also pointed out that insurers remain hungry for all types of business, including programs with starting books of business as low as $2 million.

“Four years ago, no one would talk to you unless you had a $7.5 million book to kick-start your program,” he said. “A good distribution network supported by technical underwriting skills and as little as $2 million in premium will attract attention today.”

MarketScout–a Dallas, Texas-based electronic insurance exchange, which underwrites and distributes product lines to a 60,000-member agency network–has been tracking the U.S. p-c market since 2001.

The company said its monthly “Market Barometer” is created using data assimilated via its online insurance exchange, and is supported by in-person surveys of retail agents, company personnel, wholesale brokers and managing general agents.

MarketScout said its barometer findings are also supported by surveys conducted by The National Alliance for Insurance Education and Research. These surveys were conducted during CIC and CRM institutes held across the United States in March 2008.

MarketScout says its barometer is unique because it uses mathematically-driven data corroborated by in-person surveys.

The rates of decline for March 2008, broken down by coverage class, industry class and account size, were as follows:

By Coverage Class:

o Commercial Property–down 14 percent

o Business Interruption–down 12 percent

o Inland Marine–down 11 percent

o General Liability–down 14 percent

o Umbrella/Excess Liability–down 12 percent.

o EPLI–down 12 percent

o Commercial Auto–down 8 percent

o Professional Liability–down 9 percent

o D&O Liability–down 9 percent

o Workers’ Compensation–down 8 percent

o Fiduciary–down 8 percent

o Crime–down 8 percent

o Surety–down 7 percent

By Account Size:

o Small Accounts (up to $25,000)–down 12 percent

o Medium Accounts ($25,001-to-$250,000)–down 14 percent

o Large Accounts ($250,000-to-$1 million–down 12 percent

o Jumbo Accounts (over $1 million)–down 13 percent

By Industry Class:

o Manufacturing–down 14 percent

o Contracting–down 14 percent

o Service–down 14 percent

o Habitational–down 12 percent

o Transportation–down 12 percent

o Public Entity–down 10 percent

o Energy–down 10 percent

According to the company, more than 40 “A”-rated carriers participate in the MarketScout exchange platform at http://www.marketscout.com.