NU Online News Service, Oct. 5, 3:45 p.m. EDT
The average U.S. property and casualty rate decrease was 4 percent during September, with the most competitive rates for accounts over $1 million in premium, according to MarketScout.
In the monthly "Market Barometer" report, Dallas-based MarketScout's Chief Executive Officer Richard Kerr said the lengthy soft market and recession are "creating a lot of pain for everyone." That includes insurers, reinsurers, agents and brokers, he said.
"Everyone is fighting and scratching for market share," Mr. Kerr noted. "If rates don't go up soon and the economy remains in the doldrums, the fighting will only get worse." In the end, the insured may lose out, he added.
Small agents looking to take business from larger agents are faced with intermediaries or insurers unwilling to accept accounts because of market pressure, Mr. Kerr said.
"In this market, he or she who controls the most premium sometimes makes the rules," Mr. Kerr observed. "We don't feel that is good practice because it isn't in the best interest of the insured; however, it does happen."
"Jumbo accounts," or those of more than $1 million, were down 5 percent, the electronic insurance exchange found. Large ($250,001 to $1 million) and medium ($25,001 to $250,000) accounts each saw decreases of 4 percent.
By coverage class, general liability was down 5 percent while commercial liability and inland marine were down 4 percent. Like last month, commercial auto and workers' compensation were down 3 percent.
As in August, the service industry saw the greatest rate reductions at 5 percent. Premium in the contracting industry was down 4 percent.
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