The market for liability coverage will remain competitive through 2007, according to a new study by Aon, but a hardening of the market may not be far on the horizon.
In a market report titled "Look Beyond the Obvious," Aon analysts noted that the generally benign storm activity in 2006 has led to a worldwide decrease in rates for liability coverage, with plentiful capacity and competition expected to drive rates further down throughout 2007. These reductions, according to AON, are expected to be up to 25 percent in the U.S., with even greater decreases in Europe and the Asia Pacific markets.
However, the report also pointed to a rising global "compensation culture" trend, and said that more than half of the 53 countries examined saw an increase in both liability claims and severity of awards.
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