Noncatastrophe-exposed commercial insurance pricing to fall: Willis
Reprints
Prices for noncatastrophe-exposed commercial insurance accounts will fall 5% to 10% in the second half of 2013, Willis North America Inc., a unit of London-based Willis Group Holdings P.L.C., said on Wednesday.
In a statement, New York-based Willis North America said it released a special summer update to “2013 Marketplace Realities,” its annual publication on prices in the commercial insurance market that was published in April, after data from recent insurance renewals indicated “softening conditions” for property insurance pricing.
Dave Finnis, national property practice leader for Willis North America, noted that when “Marketplace Realities” was published in April, Willis predicted catastrophe-exposed accounts were experiencing flat to 5% price increases, whereas Willis now expects rates for catastrophe-exposed accounts to remain flat or fall by up to 5%.
“The additional movement in the property market is being driven largely by new capacity entering the marketplace and represents a significant shift from Willis' forecast just a few months ago, particularly on catastrophe-exposed programs,” Mr. Finnis said in the statement. “Recent renewals were oversubscribed.”
In addition to the new capacity, which Willis said is coming from a variety of sources including China-based insurers and new broker facilities, a relatively light disaster year has helped push prices lower, the report stated.
