"More businesses are making changes to their casualty insurance arrangements in an effort to control higher premium costs associated with them," said Timothy Brady, a managing director in the U.S. Casualty Practice of Marsh, Inc.

His statement added, "In addition to retaining more risk by increasing retentions, they're putting their programs out to bid to try to get a better deal."

The study examined those buyers where year to year data was available. The report said that the average cost of risk per $1,000 in revenue, declined by one cent, from $2.39 in 2003, to $2.38 in 2004. Auto liability dropped from a 31 cents per $1,000 level in 2003 to 29 cents in 2004. General liability rose 3 cents, going from 54 cents in 2003 to 57 cents in 2004. Workers' comp dropped 2 cents, from $1.54 to $1.52 in 2004.

The study found large employers continue to enjoy significant economies of scale in the purchase of their insurance. The average cost of insurance for smaller employers was up to eight times higher than for the largest companies in 2004.

For all size companies, workers' comp costs far exceed those associated with other exposures.

"Workers compensation historically has accounted for the lion's share of casualty risk costs," said Mr. Brady, adding that buyers are examining alternative programs in an effort to control and reduce these costs.

Copies of the report are available by contacting Peggy Sherertz at (212) 345-3393.