CIAB survey shows reduced commercial risk pricing for 1-Q

The latest quarterly market index produced by the U.S.-based The Council of Insurance Agents & Brokers (CIAB) suggests that pricing of commercial business either declined or remained flat across the various size segments of the marketplace during the first quarter of this year. The survey results are based on member responses from brokers representing about 80% of annual commercial premiums.The CIAB observes that commercial rates, on average, are now approximate to pricing levels last seen at the end of 1999, which signaled the end of the last "soft market". Ken Crerar, president of The CIAB, says there are still certain risk classes that are either difficult to find coverage for, or continue to attract expensive coverage pricing. "The biggest trouble areas remain residential construction risks, umbrella coverage, workers’ compensation and medical malpractice."The CIAB index indicates that, during the first quarter of this year, cover pricing of about 50% of small accounts (those generating less than US$25,000 in annual commission and fees) remained mostly flat, with some experiencing a drop in premiums of between 1%-10%. Roughly 41% of Medium sized accounts (generating annual commission/fees of between US$25,000 and US$100,000) saw no change in premiums charged, or rate declines of up to 10%. About 45% of large accounts, which experienced the sharpest rate increases during the most recent "hard market", also either attracted steady pricing or premium reductions up to 10%.Furthermore, The CIAB survey reveals that the top concern of 40% of the broker respondents is that current market conditions could see the return of insurer pricing competition. An additional 41% of the survey respondents listed insurer pricing competition as being their second biggest concern.