Chaucer is preparing to keep a low profile in the UK commercial market for the next two years just weeks after announcing it was entering the market for the first time.

The insurer has admitted it would write only a material amount of business until rates improved, despite appointing specialist underwriter Stuart Dickinson to develop a range of UK commercial products.

Ewen Gilmour, chief executive of Chaucer, said: "[The UK commercial market] is soft at the moment and, like everybody else, our whole philosophy is price driven.

"In the past two years, rates in the general liability market, in particular, have fallen by between 10% and 30%, with the market not expected to turn until the end of 2008, early 2009."

Meanwhile, Chaucer has announced a profit of 17.2% for 2004, with both its Lloyd s syndicates delivering strong results. Its forecast for 2005 had improved, with the year expected to be profitable, and described its forecast for 2006 as very positive .

The company intended to achieve organic growth up to £800m in the next five to six years, it said.