This is another in a series of articles by industry pundits who make the industry’s case for rate hikes and ignore the substantial leakage problem in their claim departments. Unscrupulous lawyers and medical providers are thriving because prevention has become so lax. Companies are more than happy to just keep pushing up the rates as long as regulators keep rubber stamping rate requests.
I agree. The author and analysts should have added the expected and obvious rote comments about this modest volume growth and depressed profit levels being driven by the current excess of surplus in the property and casualty industry. The market turn will be seen at different times in individual sectors, from soft to hard, as surplus is depleted chasing new business, returned to investors, or ‘inadvertently’ paid to claimants on properly rated business which is not adequately underwritten.
In the Midwest we are seeing no hardening. would call it more stabilization than anything. There are a few pious carriers who think they will drive the market upward with outrageous renewal demands of 10% to 15% increases. But the only thing they will accomplish are book rolls moved to other carriers. Purely ego-driven. Really, get over yourself. 3% to 4% is reasonble, especially if reasonably managed. Most carriers are pushing this strategy and are getting the rate they need. Work Comp is the greatest line of concern, and there are still too many monoline carriers willing to write WC at incredibly stupid pricing.
This is another in a series of articles by industry pundits who make the industry’s case for rate hikes and ignore the substantial leakage problem in their claim departments. Unscrupulous lawyers and medical providers are thriving because prevention has become so lax. Companies are more than happy to just keep pushing up the rates as long as regulators keep rubber stamping rate requests.
http://www.insurancethoughtleadership.com/index.php/site/archives/2012/01/09
What an appropriate last name for the author & subject of this article…Conning!
I agree. The author and analysts should have added the expected and obvious rote comments about this modest volume growth and depressed profit levels being driven by the current excess of surplus in the property and casualty industry. The market turn will be seen at different times in individual sectors, from soft to hard, as surplus is depleted chasing new business, returned to investors, or ‘inadvertently’ paid to claimants on properly rated business which is not adequately underwritten.
In the Midwest we are seeing no hardening. would call it more stabilization than anything. There are a few pious carriers who think they will drive the market upward with outrageous renewal demands of 10% to 15% increases. But the only thing they will accomplish are book rolls moved to other carriers. Purely ego-driven. Really, get over yourself. 3% to 4% is reasonble, especially if reasonably managed. Most carriers are pushing this strategy and are getting the rate they need. Work Comp is the greatest line of concern, and there are still too many monoline carriers willing to write WC at incredibly stupid pricing.