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The end of the soft market is in sight and prices will begin an upward swing toward the latter part of this year, according to the chief executive of MarketScout.
Richard Kerr, the chief executive officer for the Dallas-based electronic insurance exchange, said in a statement that “2010 will prove to be the beginning of the end of a six-year soft market cycle.”
He said that while rates were down for all of last year, they exhibited some moderation and held steady in a small, tight range of 3 to 5 percent.
The first six months of this year will see slight reductions on “competitively marketed placements” and flat renewals on markets not under those pressures.
“By year-end 2011, the longest soft market period in the last 70 years will finally come to a close,” he declared. “For those who have been asking for just ‘one more hard market,’ your time is coming. You have six to nine months to get ready. Be prepared. Those with the ability to rapidly deploy products will win big.”
Mr. Kerr’s remarks came with the release of MarketScout’s latest market barometer that showed an average market rate pricing decrease of 5 percent for December. The figure is identical to November, and those numbers are only one percentage point higher than September and October.
By size of account, medium, large and jumbo size accounts were down 5 percent and small accounts were down 3 percent for the month.
In the coverage classes, general liability was down the most at 6 percent, followed by commercial property at 5 percent.
Down the least were commercial auto, workers’ compensation, professional liability and surety, all down 1 percent.
Fiduciary was flat.