RIMS survey finds drop in D&O premium rates

Directors and officers (D&O) and workers’ compensation reported the largest decreases in premium rates in the fourth quarter of 2006, according to the Risk and Insurance Management Society, Inc. (RIMS)’s Benchmark Survey.Commerical insurance premiums experienced some of the most dramatic rate changes of 2006, says a RIMS press release.Specifically, D&O and workers’ compensation reported sharp decreases of 5.1% and 7.4% respectively. “D&O continues to be a very competitive line of business with rate decreases further stimulated by a sharp drop in the number of securities class action suits filed in 2006,” says the RIMS statement.Property insurance was the only line of business that increased in the fourth quarter by 6.6%, the survey found.RIMS researchers attribute the rise to the legacy of the 2005 hurricane season.”Risk managers have benefited from lower premiums in most lines of business, but continue to be challenged by skyrocketing property catastrophe premiums,” Joseph Restoule, RIMS secretary and member of the board of directors, said in a statement.”However we’ve now gone a full renewal cycle since the catastrophes experienced in 2005.”Restoule remains optimistic that the market for catastrophic coverage will stabilize and even improve in 2007.