Property/casualty rates going up: Willis report
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Property/casualty insurance rates are increasing, according to a report released Thursday by Willis Group Holdings P.L.C.
Some lines are experiencing modest firming but there is no uniform market hardening, according to the spring update to the insurance broker's 2012 “Marketplace Realities” report.
The report predicts that catastrophe-exposed accounts, which saw rates climb an average of 5% to 10% in the fourth quarter of 2011, will exhibit a similar trend throughout 2012, pegging increases in the 7.5% to 12.5% range.
London-based Willis said the $108 billion in insured global catastrophe losses recorded in 2011 combined with revisions to Risk Management Solutions Inc.'s RMS version 11.0 U.S. windstorm model, a widely used catastrophe modeling tool, will put upward pressure on catastrophe-exposed rates. But Willis expects abundant capacity and the lingering weak economy to temper upward pressure on a broader level.
In fact, Willis expects rates for non-catastrophe-exposed risks to remain flat, while workers' compensation rates should rise between 2.5% and 7.5%. For directors and officers liability coverage, Willis foresees rates changing in a range of a 5% decrease to a 5% increase. Willis projects employment practices liability rates to range from a 5% decrease to flat.
