CIAB: Soft market spreads to coastal properties

The soft market conditions that have affected most US commercial property/casualty lines for more than a year have begun to spread to coastal properties with wind storm exposures, according to a new survey.

The survey, by the Washington based Council of Insurance Agents and Brokers, said coastal properties with wind exposure are still the hardest risks to insure, but market conditions are beginning to ease, and more capacity is available.

Overall, the commercial market remains soft for all sizes of accounts, the survey found. Respondents said third quarter renewal rates for the majority of accounts, regardless of size, were significantly lower than during the second quarter, with only a handful of renewal premiums showing no change.

An analysis of the survey responses showed the average premium rate for all sizes of accounts was down 13.3 % in the third quarter compared with renewals in the second quarter of 2007.

Brokers responding to the survey said the soft market was affecting even commercial lines such as construction risks, medical malpractice and D&O that have experienced rising premiums and tight market conditions in the past.