Mid Year Reinsurance Terms Favorable

The composite rate for property and casualty placements in the United States measured down three percent for July 2010. The rate is a reflection of year over year changes as compared to the rates in the preceding year.

According to Richard Kerr, Founder and CEO of MarketScout, "Insurers got just what they needed to continue aggressive pricing for the balance of the year; favorable midyear reinsurance terms. Barring a major catastrophic event, we predict an overall 'soft' market for the balance of 2010. Rates will continue to moderate in select coverages or industries but the composite rate will probably continue to show a small reduction from the immediately preceding year."

The service industry is enjoying the most competitive premium pricing with nationwide average price reductions of minus four percent. Small accounts (those under $25,000 total premium) actually moderated from minus three percent in June to minus two percent in July while medium sized accounts ($25,000 to $250,000 total premium) were reduced a bit further, from minus two percent to minus three percent for the same time period. General Liability is the most aggressively priced product line at minus five percent, followed by BOP and Commercial Property at minus four percent.

The National Alliance for Insurance Education and Research conducted pricing surveys used in MarketScout's analysis of market conditions. These surveys help to further corroborate MarketScout's actual findings, which are mathematically driven by new and renewal placements across the United States.

A summary of July 2010 rates by coverage, industry class and account size is set forth below.

By Coverage Class

Commercial Property

Down 4%

Business Interruption

Down 3%

BOP

Down 4%

Inland Marine

Down 3%

General Liability

Down 5%

Umbrella/Excess

Down 2%

Commercial Auto

Down 3%

Workers' Compensation

Down 3%

Professional Liability

Down 1%

D&O Liability

Down 1%

EPLI

Down 1%

Fiduciary

Down 2%

Crime

Flat

Surety

Down 1%

By Account Size

Small Accounts

Down 2%

Up to $25,000

Medium Accounts

Down 3%

$25,001 - $250,000

Large Accounts

Down 4%

$250,000 - $1,000,000

Jumbo Accounts

Down 4%

Over $1,000,000

By Industry Class

Manufacturing

Down 3%

Contracting

Down 3%

Service

Down 4%

Habitational

Down 2%

Public Entity

Down 3%

Transportation

Down 2%

Energy

Down 2%