While it may be premature to call a bottom, the latest Benchmark Survey from the Risk and Insurance Management Society (RIMS) indicates that rate of decreases in premium slowed during the third quarter.

“Premiums didn’t fall much this past quarter, at least not in a couple of key lines, but the soft market is far from over,” says Dave Bradford, EVP of Advisen Ltd. and editor-in-chief of the Survey. “If insurers avoid large losses this hurricane season, which seems likely at this point, competition may pick up across all lines. There is still too much capacity chasing too little premium.”

Indeed, the survey reveals that average property premium declined about 3%, and the average D&O premium dropped 4%. General liability and workers’ compensation lines fared better as both fell less than 1%. Moreover, the Advisen researchers say the soft market conditions will likely linger as the effects of the global recession wear on.

“Rates in some lines are back to where they were at the depths of the last soft market,” says Robert Cartwright, loss prevention manager for Bridgestone Americas Holding Inc. and a member of the RIMS board of directors. “That might suggest that the market is poised for a turn, but competition is still intense. Barring a large catastrophe loss, insurance buyers should continue to enjoy favorable pricing for the foreseeable future.”

 

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