Posted on 07 Oct 2010
MarketScout has promulgated the composite rate for U.S. property and casualty insurance at minus four percent for September 2010. By industry, service contractors are enjoying the largest rate decreases at minus five percent. By account size, rates were most competitive for accounts over $1,000,000 premium at minus five percent. General liability was the most competitive line of coverage with an average rate reduction of minus five percent.
According to Richard Kerr, CEO of MarketScout, "Without question, a lengthy soft market coupled with the recession is creating a lot of pain for everyone: insurers, reinsurers, agents and brokers. Small agents trying to take business away from large agents may find some intermediaries or insurers unwilling to accept accounts because of market pressure. If the agent losing the business does $50,000,000 with the intermediary or insurer and the new agent does $1,000,000, the agent with the bigger stick might be able to exert pressure that would force the market to carefully weigh the results of accepting the account from the new retailer. In this market, he or she who controls the most premium sometimes makes the rules. We don't feel that is good practice because it isn't in the best interest of the insured, however, it does happen. Everyone is fighting and scratching for market share. If rates don't go up soon and the economy remains in the doldrums, the fighting will only get worse."'
The National Alliance for Insurance Education and Research conducted pricing surveys used in MarketScout's analysis of market conditions. These surveys help to further corroborate MarketScout's actual findings, which are mathematically driven by new and renewal placements across the United States.