MarketScout Finds Premium Rates Fell 7% to 12% Last Month

Premium rates for 14 sectors of property and casualty insurance were down between 7- and 12 percent last month, an electronic insurance exchange reported today.

Dallas-based MarketScout said rates so far have not been significantly impacted by the meltdown of American International Group as well as investment banks.

Richard Kerr, MarketScout founder and chief executive officer, said in a statement: "The impact of the financial collapse of name brand banks, insurers and other companies is pending. We may start seeing rating adjustments in October. Terms and conditions for most policyholders had already been agreed in September, prior to the market collapse."

The declines by sector were:

Commercial Property, down 12 percent; business interruption, down 9 percent; BOP, down 13 percent; inland marine, down 8 percent; general liability, down 10 percent; umbrella/excess, down 9 percent; commercial auto, down 10 percent; workers' compensation, down 6 percent; professional liability, down 9 percent; directors and officers liability, down 8 percent; EPLI, down 9 percent; fiduciary, down 7 percent; crime, down 8 percent; and surety, down 7 percent.

By size:

Small accounts up to $25,000, down 8 percent; medium accounts of $25,001-$250,000, down 11 percent; large accounts of $250,000-$1,000,000, down 11 percent; and jumbo accounts over $1,000,000, down 7 percent.

By industry class:

Manufacturing, down 10 percent; contracting, down 8 percent; service, down 12 percent; habitational, down 9 percent; public entity, down 10 percent; transportation, down 8 percent; energy, down 7 percent.

MarketScout said it corroborates its data by working with The National Alliance for Insurance Education and Research to conduct in person surveys. These surveys are conducted every month during CIC, CRM and other advanced learning sessions.

Mr. Kerr commented, "The data provided by The National Alliance is an excellent corroboration of our findings. The survey data closely mirrors the actual mathematical computations. The dual validation process is part of the reason the MarketScout Barometer has a very high degree of credibility."