Modest P&C rate increases will benefit the industry more than a true hard market because they are more palatable to clients, says the chairman, president and CEO of insurance broker Arthur J. Gallagher & Co.

J. Patrick Gallagher also says a continuation of the current conditions, rather than a hard market, will benefit insurance brokers' organic growth over the long term.

During a conference call to discuss the firm's second-quarter results with financial analysts, Gallagher mentioned the latest P&C rate survey from the Council of Insurance Agents & Brokers, which showed incremental increases in insurance premium rates across the board, with some lines—Workers' Compensation, Property, Commercial Auto, General Liability and Umbrella—up by more than 5 percent.

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