Commercial insurance premiums were flat to slightly lower in the second quarter of this year compared to the prior-year period, according to the RIMS Benchmark Survey.
In the second quarter, directors and officers premium dropped 3.5 percent, the largest decrease of any line of business tracked by the survey and due largely to rate cuts for small- to medium-sized businesses.
Average property insurance premiums were largely unchanged, although the average masks significant discrepancies between policies in hurricane-exposed regions and policies in other parts of the country, the survey noted.
Insureds in Florida and the Gulf Coast states are experiencing massive increases in the aftermath of the record-shattering 2005 hurricane season. Those in the mid-Atlantic states are also encountering higher premiums, while policyholders in the Western and, especially, Midwestern states are enjoying substantial savings on property premiums, the survey found.
"Aside from the increase in property insurance premiums in catastrophe-exposed regions, insurance premiums continue to trend downward," David Bradford, editor-in-chief at Advisen, said in a statement. "We expect to see this trend continue for the remainder of 2006. The industry had a good first quarter, which will further fuel competition."
The New York-based insurance advisory firm Advisen conducts the survey each quarter for the New York-based Risk Insurance Management Society.
"Risk managers are generally benefiting from softer rates, but companies in natural catastrophe-exposed regions aren't likely to see property insurance pricing conditions improve anytime soon," said RIMS Board member Joseph Restoule.
General liability, which experienced a slight uptick in average pricing in the first quarter, resumed its downward slide in the second quarter, falling 1.2 percent.
Advisen analysts claimed the increase in general liability premiums were a temporary response to a spike in property premium levels. Workers' compensation was essentially unchanged.
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