RJ and Makay

Though March saw commercial property & casualty (P&C) rates fall yet again, the average decline of 4% was at least smaller than the 5% drop that occurred in each of the previous four months. Also, several lines of coverage — workers comp, property, business interruption, small commercial, general liability, and automotive — are showing a moderation of rate cuts, MarketScout reports.

“We have finally broken out of the doldrums. Rates are moving,” remarks MarketScout CEO Richard Kerr. “It looks like the soft market from 2005 to 2011 will end with workers compensation and catastrophe exposed property risks leading the way out.”

So far, the earthquake and tsunami in Japan have not affected property-casualty (P&C) insurance costs for U.S. policyholders, reports industry expert Alfred Tobin, managing director of Aon Risk Solutions. According to Tobin, U.S. insurers have not raised rates or issued rate recissions on policies coming up for renewal April 1, the biggest day for P&C renewals.

“Carriers behaved well, but we have a few exceptions,” relates Tobin, though he's not naming names. Rate quotes issued in the first quarter of this year have mirrored those for all of 2010, with single-digit reductions the norm, he says.

Inflation is occurring in some industries, but not property-casualty. The composite rate for P&C insurance dropped 5% in February — the fourth straight month of 5% declines in the P&C market, reports MarketScout.

The market seems “stuck,” says MarketScout CEO Richard Kerr. “The rates by industry, coverage, or account size change a bit each month but generally all categories are staying in the same range of premium reductions.”