The cost of risk fell last year after three years of increases, and the market continues to soften, according to the annual Risk Insurance Management Society’s US Benchmark Survey.

Businesses paid nearly 1% less to cover the total cost of risk – measured as the cost of insurance plus retained losses and the administrative costs of the risk management department.

The average total cost of risk fell to $US10.80 per $US1000 of revenue from $US10.90 in 2013, according to the study conducted with researcher Advisen.

Advisen Executive VP Jim Blinn says the results reflect the overall stability of the US property and casualty market.

Alternative capital inflows affected the result, as did the rising importance to insurers of predictive modelling.

The annual survey draws on industry data from more than 52,000 insurance programs from about 1500 organisations.