CIAB SURVEY SHOWS Q1 COMMERCIAL P/C EASING:

Lastly, the Council of Insurance Agents and Brokers has issued a report indicating that the commercial property and casualty market “continued to ease across most lines during the first quarter of 2004, with the average premium increases for all sizes of accounts returning to the levels they were at the end of 1999, when the last soft market cycle was coming to an end.” The survey showed that about 50 percent of small accounts, those generating less than $25,000 in commissions and fees, experienced no change in premiums or saw premiums drop during the quarter by 1 to 10 percent. An additional 41 percent of the small accounts had only slight premium increases in the 1 to 10 percent range. The analysis showed the average premium increase for small accounts was about 3 percent. For medium accounts, ranging from $25,000 to $100,000 in commissions and fees, the picture was roughly the same. Forty-one percent of the accounts had no change or a drop of as much as 10 percent in premiums, while 9 percent of respondents reported a drop of 10 to 20 percent. Forty-two percent of the medium accounts had premium increases in the 1 to 10 percent range. The average rate of increase for medium accounts was 1 percent. The CIAB survey found that large accounts had experienced the sharpest increases in premiums during the hard market conditions of the last two years, and they also experienced the greatest drop in premiums. The biggest trouble areas where coverage is hard to find and expensive, according to CIAB President Ken Crerar, remain residential construction risks, umbrella coverage, workers’ compensation and medical malpractice.