Soft commercial market conditions poised to continue in 2011: Marsh Canada report

Soft commercial insurance market conditions persisted throughout Canada in 2010 and are poised to continue into 2011, according to a comprehensive report published by Marsh Canada.
“Key commercial insurance market drivers from 2009 -including intense competition among insurers, abundant capacity and relatively few insured catastrophe losses -continued through 2010 and are forming market conditions for 2011,” Marsh said in its report, Approach Your Risk With Clear Direction: North American Insurance Market Report 2011.
The report found clients are seeing lower rates on average across all major coverage lines. For Marsh clients renewing in the fourth quarter of 2010:

• property rates typically declined 5% to 10%;
• primary liability rates declined 7.5% to 12.5% for clients with low-risk profiles and little U.S. exposure; and
• directors’ and officers’ (D&O) liability insurance rates for public companies not listed in the United States were flat to 15% down.

“The Canadian commercial insurance market remained soft in 2010, as efforts by insurers to retain existing clients helped fuel a competitive marketplace,” said Alan Garner, president and CEO of Marsh Canada Limited.
“A number of new entrants, seeking to benefit from the relatively attractive property and casualty environment in Canada, have also helped to make conditions favourable to insurance buyers.
“Canadian insureds have generally continued to buy the same level of insurance and, in some case, reduced their retentions without seeing increases in premiums or rates.”
It is likely that market reductions offered in 2010 will flatten out somewhat in 2011, with most insureds seeing fairly flat renewals and best-in-class organizations seeing decreases, Garner predicted.
“Results for individual insureds will continue to be affected by overall loss records, significant changes in catastrophe exposures, and their level of U.S. exposures, among other factors,” he said.
The complete report is available at:
http://www.insurancemarketreport.com/2011/Home/tabid/8060/Default.aspx