The longstanding sag in commercial property/casualty pricing may be ebbing, according to The
Although prices declined by 2.9% in the first quarter of 2011, this compares favorably to 5.4% decline recorded in the previous quarter, CIAB notes. “It’s too early to tell if the leveling off and modest price increases were a result of the fallout from the recent Japan disaster and other catastrophes earlier in the year, or if the market is reacting to broader market conditions,” CIAB President Ken Crerar said in a statement.
CIAB credits the hardening to concern among brokers about potential catastrophes. “Carriers seem concerned about the future CAT season,” one broker told CIAB. “We’re only three months into the year and we’ve had a very active year already. There are still nine months of flood, tornado and hurricane seasons and this could certainly impact the marketplace.”
The numbers also reflect a slowly improving economic environment and increased demand for commercial products. Indeed, 57% of commercial insurance brokers responding to a CIAB national survey said they saw an increase in demand, compared with 47% last quarter.
The rise is business demand is most evident in workers’ compensation pricing. The report notes that 21% of respondents indicated that they have seen workers’ compensation premium increases of between 1-10% over the last three months and 7% indicated that they have seen increases between 10% and 20%.
