NEW YORK--An executive with an American International Groupsubsidiary denied suggestions today that the company is holdingonto business by engaging in aggressive price cutting that isprolonging the property-casualty soft market

John Q. Doyle, president and CEO, AIG Commercial Insurance, madehis remarks during a panel discussion at the 20th Annual ExecutiveConference for the Property-Casualty Industry presented by NationalUnderwriter Company and sponsored by Ernst & Young and Dewey& LeBoeuf.

Mr. Doyle said he was curious that AIG is being singled out whenhis company's top line was down seven percent during the thirdquarter. Some companies criticizing AIG, he said, had increasedtheir top line during the quarter.

Panel moderator Sam Friedman, editor-in-chief of NationalUnderwriter, said the industry has sent mixed signals regarding thesoft market.

Some participants, he said, indicate that pricing is beginningto harden, while others have singled out AIG for driving pricesdown as it attempts to hold on to business and combat damage to itsreputation by pricing aggressively.

Mr. Friedman noted that it is odd to hear some in the industrysingle out one competitor, rather than speaking broadly about themarket.

Mr. Doyle remarked that there seems to be "no shortage ofexperts" in the industry regarding what is going on at AIG. Headded that while challenges at the parent company have inflictedsome brand damage, the strengths of AIG Commercial remains thesame.

Regarding the state of the market, the experts on the panel didnot share a consensus on whether the soft market has come to anend.

Mr. Doyle said pricing is still down, but there has been modestimprovement since early July. He explained that there is still noshortage of capacity in many lines, adding that as capacity leaves,or as consolidation occurs, prices will move.

George Fay, executive vice president, WorldwideProperty-Casualty for CNA, said he has met with producers, and theyindicated that prices are already stabilizing, and cited some lineswhere prices are rising. He said producers are already tellingcustomers to expect increases, and they also said the market willlikely harden over the next six months.

Stanley A. Galanski, president and chief executive officer, TheNavigators Group, Inc., said he was not as optimistic that the endof the soft market is here, but he added the industry is gettingcloser.

The executives mentioned access to capital as one area ofpotential concern going forward. Mr. Friedman noted that AIG, TheHartford and CNA are among insurers that have gotten a capitalinfusion of some sort, and he questioned where the industry willget capital from in the future.

Mr. Doyle noted that AIG's p-c outlets have not needed to accessthe capital that the parent company received, but he said inabilityto raise capital could change the market very quickly if acatastrophe event were to take place.

Determining how much capital insurers have is difficult, Mr.Galanski noted, given the state of the debt markets.

Mr. Galanski also shared some lessons learned during the recentfinancial struggles. He said companies should:

o Understand that underwriting matters.

o Not underwrite what they do not understand.

o Understand the downside of risks.

o Understand that a handful of people can destroy a majorcompany that took years to build.

o Understand that size does not necessarily equal strength.

At a separate discussion at the conference, Pierre L. Ozendo,member of the executive board, chairman, and chief executiveofficer of Swiss Re American Corporation said the industry willemerge from the current financial problems, but it may be at thecost of some companies failing.

He stressed that companies need to manage capital forpreservation, that solvency and security matter, and that riskmanagement and risk modeling need to become competencies for allfinancial firms. He added that the economics of the industry remainsound, but challenged, and said the underlying strength of theindustry would prevail.

All panelists agreed that sound underwriting is a must for theindustry to weather the current environment.