The insurance market has reached the top of its cycle and rates are on the brink of falling, was the key message at Marsh's annual state of the market address.
The broker also said the market neede ...
The insurance market has reached the top of its cycle and rates are on the brink of falling, was the key message at Marsh's annual state of the market address.
The broker also said the market needed to rebuild policyholders' confidence in insurers.
Marsh head of UK retail placement Mike Jones said that property prices had reached a peak and that premiums may fall in 2004.
"We are seeing property business beginning to plateau. In 2004, I can see an easing back of the market and, unless there is some intervention, I see prices falling."
Jones said the levelling off of rates was due to softening reinsurance rates and increased capital coming into the primary market.
But casualty rates were still rising, he said. "Reinsurers have decided to hit casualty this year. There is no softening of rates and we are sill seeing coverage problems. Opportunistic pricing is also taking place, with insurers charging what they can get away with.
Zurich London chief executive Martin South said policyholders should still have faith in the industry. "Our expense ratios are down and we can be transparent in terms of pricing. There is a role for the industry if we can maintain this."
