Insurance Pricing Cycle Due for a Change, Berkley CEO Says

By | November 4, 2010

  • November 4, 2010 at 12:52 pm
    the advocate says:
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    Bill Berkley sounds like a relative of the Greenberg’s pushing for price increases.
    Hey Bill, get a life.

  • November 4, 2010 at 2:18 am
    Rabbits for Sale says:
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    Lets be honest. Unless you’re paying the invoices, the rest of the market wants rate increases but doesn’t know how to make it happen.

    Every day I get calls from production underwriters willing to undercut for an order. I never hear a PEEP from anyone looking to rationalize their rating structures.

    And if I don’t get calls from underwriters looking to get the biz, I am meeting with clients with sweet P&L’s who question why their rates don’t drop to drive ratios closer to break-even.

    And if I don’t get calls from hungry underwriters or visits with premium-strapped clients, I get emails from management telling me what our production goals for 2011 are, what the expected retention rate is, and why my salary is at a ‘perfect’ level in the market for someone with my set skills!

  • November 4, 2010 at 6:43 am
    Keep it real says:
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    The simple fact is that he is right. Rates have been falling across all lines. The expenses have not. The amount of capacity has been increasing, a sign that one underwiter thinks they are smarter than their competitor, which is not the case. Carriers have a heard mentality, following each other into the rathole. Most, not all mind you, but most broker/agents sell price because it is easy, and they never considered selling value or the concept of “total cost of risk”. A underwriter that is not making a fair rate of return on captial cannot afford over the long term, to invest in its people, technology, and client services. The industry has a long track record of A rated carriers that are no longer around.

  • November 5, 2010 at 10:12 am
    Meriweather says:
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    words to live by.

  • November 5, 2010 at 10:24 am
    Rabbits for Sale says:
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    I’m not sure if price can be the only determinant in a purchasing decision.

    I competed for a prospect’s specialty GL placement, offered a reduction from expiring yet got beat by a stupid price from a London pen. I await my marketing team’s analysis of the other form versus the one we represented, and if I am right, hope to re-open the door to point out glaring coverage differences.

    Optimistic thinking, but if the cheapo vendor didn’t do a quote comparison, then maybe I can convince the buyer that he got crud coverage regardless of what he thought he was getting as a short-term saving.

    Conversely, I now have to include the crud market in my marketing submissions, in the fear that if I don’t, someone else might.

    I have to present the cheapo quote when I get one. And if it turns out that there are sound reasons for doing so, then I’m obligated to do so, and allow the buyer the opportunity to make a sound, feasible decision using my recommendations as support. Even if my commission income goes down by 20% in the process.

  • November 5, 2010 at 10:31 am
    Cynical says:
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    BRING IT ON, I need a raise. There are so many issues at hand here. Clients don’t want to look elsewhere because they are being told renewals are going down and they are also people strapped to do the footwork. This eases the other pains that they may be experiencing from their agent which may be a major issue, but the idea that they are paying 10-15% less by not doing a thing suits them fine. I want competition fostered by increased premiumsm, not lower premiums.

  • November 5, 2010 at 11:21 am
    Rocket man says:
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    are agressive, and there are numerous times when Nautilus, Admiral or one of the standard companies under the Berkley name is cutting prices to write business. It has been going on for years and will continue into the future. Not sure where Wild Bill is getting all of his data, he needs to talk to his front line UW’s, they will tell him the truth.

  • November 5, 2010 at 5:33 am
    MW standard market says:
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    He’s NO different than any insurance exec, right? NONE of them know that in the heck is going on at the frontline. They sit in their ivory tower and pontificate.

    Noooooo, my underwriters would never do that !

    At least that is what they think, while their Underwriters are squeezing down that ratole, farther and farther, deeper and deeper.

  • November 6, 2010 at 9:41 am
    I remember when says:
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    Yes, I remember when Lib Mutuals top boss talked about underwriting discipline, and the need to be firm and conservative in pricing. Wasn’t that like 2 years ago? Has he looked at the books of Indiana or Peerless Insurance? No wonder his IPO wouldn’t fly. the Lib mutual regional markets are a house of cards ready to collapse.



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