“Pricing has been fairly stable in three of the last four quarters, but it is too early to declare the soft market over,” says Dave Bradford, Advisen executive vice president and editor-in-chief of the survey. “Rates may have stabilized for now, but barring major catastrophe losses, there are few signs of materially higher premiums on the horizon. The commercial property & casualty insurance market remains well capitalized, and the current sluggish economy could make it difficult for underwriters to push through rate increases.”
Record-shattering tornado losses in the US, combined with losses from the Japanese earthquake and tsunami, floods in Australia and earthquakes in New Zealand, battered insurance carrier results through the first half of 2011, but the impact has not been sufficient to trigger widespread premium increases outside some of the affected areas. Additional catastrophes, however, could spark higher rates for property and possibly other lines of insurance.
“Insurance buyers continue to benefit from a competitive insurance market, but the situation could change quickly,” says Frederick Savage, FCII, ARM, RIMS Board of Directors. “Hurricane season is underway in the US and forecasters continue to call for above-average activity. One or two very large storms on top of the catastrophe losses in the first half of the year could be enough to spark higher premiums, at least for property risks.”
About The RIMS Benchmark SurveyTM
RIMS Benchmark Survey™ is produced by Advisen, Ltd., which collects and analyzes the data and provides the technology infrastructure for the survey’s online services. Risk managers and buyers of insurance either contribute directly to RIMS Benchmark Survey™ or by using our “data participation letter” to authorize their broker to provide the client’s program details. The letter is available at www.RIMS.org/brokerform or by calling 800-655-6590. Risk management professionals can also contribute by e-mailing current and prior year policy schedules to Benchmark@RIMS.org or by faxing to 212-655-7453.
Risk managers who contribute data to the survey can benchmark the structure of their commercial insurance programs, retained loss costs, exposure demographics and Total Cost of Risk (TCOR) against a highly relevant group of peer companies. Additionally, survey respondents can use software personalized and configured for their needs to view detailed schedules of insurance, programs for current and past years and full-color program tower charts. Both benchmark charts and program charts can be downloaded into any presentation for senior management. The results of the RIMS Benchmark Survey™ are available online or in an annually-published book. Visit www.RIMS.org/benchmark for details.