NU Online News Service, Aug. 4, 1:48 p.m. EDT

Despite losses that would normally promote a hardening in the power sector insurance market, rates remain soft with no sign of a turnaround in the near future, according to a report from insurance broker Willis Group.

In a 72-page report titled "Power Market Review, Summer 2010, Global Markets International," Willis Ltd., a member of Willis Group in London, said insurance rates in the power sector are expected to soften further in 2010, despite the existence of many of the conditions that would normally presage a hardening market.

Foremost among these conditions is the steady stream of losses associated with generating equipment. Insurers continue to be beset with attritional machinery breakdown claims. Willis found that, over a 10-year period ending in 2008, such claims accounted for only 3 percent of the total number of losses but 43 percent, or $4.2 billion, of total loss value.