Insurance executives expect continued rate declines for major insurance lines, less profitability, and flat to negative premium growth this year, according a recent survey by Insurance Information Institute.

I.I.I. polled insurance executives who gathered Tuesday at the 12th annual Property/Casualty Insurance Joint Industry Forum in New York.

Respondents agreed that the p-c industry can expect soft market conditions to continue. Fifty-two percent said they expect no improvement in pricing for personal auto. Fifty-five percent said the same for homeowners, 74 percent for workers' compensation, and 62 percent for commercial lines.

Additionally, 50 percent said premium growth will remain flat, and 33 percent said it will be negative. Just 17 percent said they believe premium growth will be positive. Fifty-nine percent said they expect the combined ratio to be higher in 2009 than it was in 2008.

For investments, 59 percent of respondents said they expect another down year in the equity markets.

Just 5 percent of respondents believed trends in litigation activity will improve. Thirty-two percent said tort trends will stay the same and 63 percent said they will deteriorate.

Seventy-six percent of respondents said they expect consolidation among insurers and reinsurers.

Respondents also did not see action coming from Congress on regulatory or national catastrophe issues.

Ninety-three percent said they do not expect national catastrophe legislation, largely based on the view that other matters will take higher priority, according to I.I.I. Fifty-one percent did not see optional federal insurance charter legislation gaining momentum this year.

"Looking forward to 2009, owing partly to the weak economy, the year is likely to see a soft market, which has persisted for some years," said Steven N. Weisbart, I.I.I. senior vice president. "Low interest rates and a weak investment climate are unlikely to provide a significant source of profits for the industry," he added.

Special Reports /

Most Insurance Execs See A Bleak Year Ahead For Profits, Prices

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