Insurance carriers are aggressively chasing markets and dropping prices to get business, a quarterly survey of insurance brokers indicates.
The survey results point to dramatic premium drops in some parts of the United States, said the Washington-based Council of Insurance Agents and Brokers, in releasing its latest report on commercial property-casualty premiums.
Noting comments the CIAB received from respondents, brokers said carriers are going to great lengths to grow market share, generating increased competition and prompting companies to loosen underwriting standards and price aggressively.
Of the 106 CIAB members who responded to the survey, covering the first three months of this year, 77 percent said their small account rates were down between 1- and 30 percent, while 92 percent said medium-size accounts were down in that range, and 85 percent said premiums were down by the same amount.
The CIAB noted that an analysis done by Lehman Brothers found rates declined an average of 11 percent in the quarter, compared with close to 10 percent in the fourth quarter of last year.
Premium rate declines started to moderate beginning with the third quarter of 2005, and continued that moderating cycle through the first quarter of 2006. Since then, the rate of decline has accelerated to where it stands today.
General liability had the largest decrease at 12 percent, followed by commercial liability and commercial auto at slightly above 10 percent, and workers' compensation at over 9 percent.
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