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Soft property/casualty pricing expected to continue

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U.S. risk managers can expect generally favorable rates this year, according to a report released by Marsh L.L.C. Thursday.

Marsh's “United States Insurance Market Report 2016” noted that property rates continued a two-year softening trend in 2015, and that trend is “expected to continue in 2016, barring unforeseen changes in conditions.” The report said that rates are “generally decreasing” in the property sector because of low catastrophe losses last year, a “high level” of insurer competition and “alternative sources of capital are expected to continue to buoy the market.”

Marsh found that U.S. commercial property insurance rates declined on average between 5% to 10% for non-catastrophe exposed risks and between 5% to 15% for moderately catastrophe-exposed risks.

Much the same assessment applies to the casualty market, as rates generally softened in 2015 according to Marsh. It noted, however, that automobile liability “remains the most challenging of casualty areas.” The report said that nearly half of all auto liability clients experienced rate increases in the last quarter of 2015, “with trucking exposures facing a particularly difficult market.”