Much of the pricing for insurance products in the property/casualty field depends upon market conditions and the appetite for risk carriers demonstrate. As the U.S. economy has tumbled out of control, many expected the market to move from its current softness to a hard market in which more attention to underwriting would have to be paid. But such expectations have yet to materialize in actuality.
“I would have guessed we would have been in a hard market by now, certainly on the commercial lines side, but by all indications that's not happening, so there continues to be market softness across the board,” says Ellen Carney, a senior analyst with Forrester. “I don't see that changing soon.”
And despite the continuing soft market, carriers have become much more interested in better underwriting tools, Carney observes, adding she has fielded questions from a number of carriers about rating engines. “There is a lot of curiosity about what else is out there,” she says. “[Carriers] are not saying specifically they are concerned about their pricing, but that's clearly what's going on.”
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