NU Online News Service, June 6, 3:04 p.m.EDT

Despite market conditions that should be edging pricing up, theU.S. property and casualty market still remains soft with compositerates in May running at minus-4 percent, according to the onlineinsurance exchange MarketScout.

The Dallas-based company's monthly market indicator now hasrates at minus-4 percent for the last two months. Prior to Aprilthe barometer held steady at minus-5 percent for four months.

Richard Kerr, CEO for the company, says in a statement,“Financial and economic metrics may support a market turn, butreal-life situations have a considerable influence on the actualpricing set forth by underwriters.”

By coverage class, inland marine and general liability were thesoftest lines at minus-3 percent. The most stable wereprofessional, directors and officers liability, employmentpractices and crime, which were flat.

Large accounts (risks with$250,001 to $1 million in premium) were the softest at minus-5percent. On small accounts (up to $25,000 in premium), premiumpricing was flat. Jumbo accounts (over $1 million in premium) wereat minus-4 percent, and medium-size accounts (premium of $25,001 to$250,000) stood at minus-3 percent.

In an analyst's note, Meyer Shields of Stifel Nicolaus says forthe carriers, rates are going in the right direction, noting thatfour lines are showing no decrease in price direction. He says theslight change in pricing direction is primarily due to thedeterioration in carrier results as “reserved development tailwindssubside.”

In his analysis, he was more bullish on personal-lines insurers,where he says carriers are getting rate increases. He also feelsinsurance brokers would benefit from a turnaround in the market, asthey would be able to enjoy some organic growth.

In the future, Kerr says MarketScout would seek to highlightpricing in an insurance group. For this month's report, he toucheson the energy sector where he says there is a “pricing war” between“two large insurers.”

“Underwriters from each company have realigned and egos areinvolved,” he says.

The underwriters, he went on to say, are involved in grabbing asmuch market share from the other in an effort to offset losses andget the other to “finally surrender.”

The market is further complicated by a new entrant that isactively underpricing that sector's risk.

According to the barometer, energy is showing the steepestdecline, down 6 percent.