Commercial rates flat, Towers says

It’s the eighth consecutive quarter (actually a 1% decline).

Five lines – commercial property, professional liability, D&O liability and EPLI all showed declines for the fifth quarter in a row.

Small and mid-market accounts were flat; large and specialty accounts showed declines.

The survey also indicated AY10 loss ratios are 5 points higher than in 2009, which were themselves 2 points higher than 2008.

Claim cost inflation was 4%, in line with long-term averages. (Last year claim cost inflation was -2%.)

Quoth Bruce Fell, director of Towers P&C practice in the Americas: “Our survey results for 2010 support the contention that the economic recovery will be accompanied by higher cost trends, and those estimates could increase if additional ‘catch-up’ from 2009 negative trends — beyond a return to long-term averages — would occur with rebounding economic conditions.”


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