In the fourth quarter of 2012 and Q1 2013, we've seen P&C price increases of at least 5 percent, according to surveys by the Council of Insurance Agents and Brokers. Would you agree that pricing is beginning to firm, and do you think this trend, if we can really call it that yet, will continue?
Generally, pricing has been trending positive and we expect that to continue for the remainder of 2013. In the first quarter, our Commercial business worldwide reported positive rate change of 4.2 percent, while in the U.S.rates increased 7.4 percent on average. Segments of Casualty and Property, where rate increases are most needed, are partly driving the trend. While there is still capacity in the market, insurance companies need to raise their rates due to the low interest rate environment.
At AIG, we believe there is also a flight to quality. Corporate buyers are looking for access to global markets; new products such as our Cyber Risk solution; and claims, engineering and loss mitigation services that they can't get from most companies. Clients highly value these services.
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Shawn Moynihan
Shawn Moynihan is Editor-in-Chief of National Underwriter Property & Casualty. A St. John’s University alum, Moynihan has earned 11 Jesse H. Neal Awards, the Pulitzers of the business press; seven Azbee Awards, from the American Society of Business Press Editors; two Folio Awards; and a SABEW award, from the Society of American Business Editors & Writers. Prior to joining ALM, he served as Managing Editor/Online Editor of journalism institution Editor & Publisher, the trade bible of the newspaper industry. Moynihan also has held editorial positions with AOL, Metro New York, and Newhouse Newspapers. He can be reached at [email protected].
