The average decline in commercial insurance rates for the quarter fell another 1.5 points to negative 13.5 percent, according to a survey by the Council of Insurance Agents & Brokers.

The quarterly survey found the soft market firmly entrenched as none of the 119 broker respondents reported an up-tick in rates for any size accounts.

For the first quarter of this year the average decline in rates for small accounts (commission and fees of less than $25,000) stood at 10 percent.

For midsize accounts (commission and fees between $25,000 and $100,000) the average decline in rates was 14.7 percent. Large accounts (commission and fees above $100,000) experienced the steepest decline at 15.7 percent.

The rates were larger than the fourth quarter average of negative 12 percent, where small account decline stood at negative 8.4 percent and both midsize and large accounts stood at negative 13.8 percent.

Among some of the lines highlighted by the Washington, D.C.-based association's survey, commercial property showed the sharpest decline at 14.8 percent, a 1.8-point increase over last quarter's 13 percent rate decrease.

Property was followed by general liability at negative 13.6 percent, a 0.6-point increase over last quarter. Umbrella fell another 2.4 points, going from negative 11.1 percent last quarter to negative 13.5 percent.

The vast majority of brokers said rates on their accounts were down from 1-to-20 percent. On small accounts, 78 percent of brokers said rates dropped in that range, while 74 percent of the brokers put the decrease in that range for their midsize accounts. Sixty-two percent of brokers said their large accounts fell in that range.

None of the brokers reported rate increases.

Only 6 percent of brokers with small accounts reported steeper decreases between 20- and 30 percent. The brokers said medium and large size accounts experienced steeper declines. Twenty percent of medium size accounts dropped 20-to-40 percent, and 30 percent of large accounts saw decreases in that range.

J. Hyatt Brown, chairman and chief executive officer of the Daytona Beach, Fla.-based insurance brokerage firm Brown & Brown, referenced the CIAB's report during a financial analyst's conference call today as an illustration of the soft market pressures the firm faces.

He said his company is experiencing many of the anecdotal observations about the market mentioned in the report. He noted that insurers are hungry to capture market share and are seeking to write more classes of business out of the wholesale markets.

"The companies are still making [a lot] of money," said Mr. Brown. "As long as that continues, this [soft] market is going to continue."

Special Reports /

Soft Market Average Decline Increased To 13.5%

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