Property/casualty price firming to continue throughout 2013: Barclays

Firming commercial property/casualty insurance pricing should continue through 2013, according to an analysis released by Barclays Capital Inc. on Tuesday.

Barclays noted that the Council of Insurance Agents & Brokers' fourth-quarter 2012 pricing survey showed that prices had increased 5% year over year, up from a 3.9% gain in the previous quarter.

“This means the pace of rate increases accelerated for the first time since 1Q12,” said Barclays in “1Q13 Preview: Raising Estimates on Low Cats; Price Increases Persist.”

“This 5% increase (the strongest in a decade) reinforces our view that the trend of firming P&C prices should continue through 2013,” according to the report.

But Barclays also noted that the impact of Superstorm Sandy probably provided a short-term pricing lift in the fourth quarter of last year. And “we anticipate the pace of price increases could ease in future quarters if insurers' underwriting results recover.”

The analysis also said U.S. property catastrophe reinsurance rates could be “flat to slightly lower at the midyear Southeast/Florida 2013 renewals (compared with flat pricing at January 2013) but still offer attractive returns.”