The industry’s combined ratio stands somewhere around 107-108 for last year as insurers continue to feed off of the good years and use their surplus. That use of surplus will continue through this year, Mr. Doyle said. He added that he expects the surplus will “dry up in a meaningful way” through this year.

The industry has a record surplus of $550 billion in support, said Mr. Doyle. A significant amount of that capacity, he noted, came from the anticipated floundering of Chartis (which is a subsidiary of American International Group) and other insurers who were experiencing economic trouble. Some in the industry anticipated that the major insurers would falter and open the market for other carriers. Because that did not happen, it led to the record supply of capacity that is still being utilized.

Mr. Doyle also noted that loss cost inflation and low yields from investments will also impact the earnings of the p&c industry.

Additionally, he said the economy is also pressuring prices, which has led to a supply and demand imbalance.

“What does that mean for the pricing side for 2011? Unless we see some level of discipline in our business…my sense is that business will remain somewhat competitive for 2011,” Mr. Doyle said.

When asked during a question and answer period when a market change would come, Mr. Doyle said “we would have to see an extraordinary event to see the scales tip in a different direction.”

He noted, too, that while he has seen some “stupid” underwriting, generally the markets are acting responsibly through this soft market cycle. He added, however, that investors are anxious to see a better return on their investments that were once in the double digits back in the 80s and now stand at single digits.

Directing his comments to specific ends of the business, on the commercial side, which accounts for 80 percent of Chartis’ business, he said unemployment remains a key obstacle to improving results. There are some pockets of improvement, but the overall climate is not robust, he said.

“[It is] a mixed bag from an economic point of view,” said Mr. Doyle. “Seeing some recovery on the consumer lines side and [commercial lines] side remains challenging, and that imbalance is expected to continue.”

Regarding personal lines, there is some uptick taking place there, he pointed out, as affluent customers are beginning to spend money again and purchase insurance to cover assets. He said lines such as accident and health, travel related, and extended warranty coverage are experiencing improvements.

Touching on the issue of regulation, he said it is too soon to know what impact the changes in federal law will have on the insurance industry. However, he urged the agents and brokers in the room to make certain that those who do regulate the industry be knowledgeable about the business.

“We have to speak loudly and have to make sure that our voice is heard,” Mr. Doyle advised. “We have got to make sure that the people who understand our business regulate us.”