Premium pressure set to continue
Intense competition and healthy capacity levels combined to push premium rates down over the second quarter of 2007, according to Aon Australia.
Its latest insurance market report highlights the PI and directors’ and officers’ (D&O) sectors as battlegrounds for insurers during the mid-year renewals season, particularly in the SME market.
PI and D&O experienced price reductions in the low double digits, according to Lambros Lambrou, Aon’s head of market services.
“The traditionally large volumes of business renewing at June 30 whetted the appetite of many insurers.”
Aon predicts the soft market will continue until at least the start of 2009, if not beyond. Capacity will continue high over the next 12 months, although consolidation may start to affect the market in the medium term.
“The Australian insurance market is likely to consolidate further over the next few years, reducing available choice to buyers,” Mr Lambrou said.
Its latest insurance market report highlights the PI and directors’ and officers’ (D&O) sectors as battlegrounds for insurers during the mid-year renewals season, particularly in the SME market.
PI and D&O experienced price reductions in the low double digits, according to Lambros Lambrou, Aon’s head of market services.
“The traditionally large volumes of business renewing at June 30 whetted the appetite of many insurers.”
Aon predicts the soft market will continue until at least the start of 2009, if not beyond. Capacity will continue high over the next 12 months, although consolidation may start to affect the market in the medium term.
“The Australian insurance market is likely to consolidate further over the next few years, reducing available choice to buyers,” Mr Lambrou said.