NEWS RELEASE
Annual Publication Illustrates as Some Lines Buoyed Overall Market,
Most Lines Experienced First Year Long Soft Market in a Decade
Philadelphia, April 18, 2004 The commercial insurance market was a much more hospitable place for risk managers in 2004 than it had been in recent years. Steadily growing capacity, leading to heightened competition, made this past year the first 12-month long soft market since 1998, according to the annual market survey from the Risk and Insurance Management Society (RIMS) which was released this week as a printed companion to the online RIMS Benchmark Survey.
The annual survey is produced and published by Advisen, Ltd., which collects and analyzes the data and provides the technology infrastructure for the survey’s online services. The survey is available for purchase at www.rims.org/2004book or by calling +1.800.655.6590.
In the survey’s Executive Summary, Advisen’s Editor-in-Chief, David Bradford notes that while all the major lines were experiencing decreases in pricing by year’s end, the overall cost of risk across coverage lines rose slightly in 2004, due largely to management liability and workers’ compensation premium increases in the earlier part of the year. While both lines eventually experienced declines, the increases in the earlier part of the year slightly buoyed overall 2004 prices.
The survey, with responses from nearly 1,400 US & Canadian companies, demonstrated that while prices were declining, higher retention levels left over from the hard market – a common antidote to increasing insurance prices– also contributed to an overall higher cost of risk as companies booked larger retained property and D&O losses. Despite growing demand for management liability coverages -- a continuing legacy of the corporate malfeasance scandals -- cutthroat competition in upper excess D&O layers drove down overall premium levels for the largest buyers.
“This is the second year we have applied new technologies to gathering and analyzing data on the commercial insurance marketplace. Again for 2004, we have unmatched insight into the market conditions that affected the insurance industry over the past 12 months and will undoubtedly affect it at least over the next few quarters,” said Daniel H. Kugler, RIMS Vice President, Membership. "We consider the annual Benchmark Survey as a highlight of the value RIMS provides to its members and prospective members.”
Advisen, a provider of specialized information, analytic and benchmarking tools for commercial insurance professionals, analyzes the survey results continuously throughout the year, offering a dynamic and virtually real-time window into the current purchase patterns of commercial insurance buyers. Advisen has produced the RIMS Benchmark Survey for three years. The aggregate survey results represent data compiled from over 1,400 organizations, the largest number of respondents in twenty years of benchmark surveys.
“Both the annual Survey, our quarterly updates, and the annual book are designed to leverage Advisen’s unparalleled access to industry information and translate that into insight which can help risk managers make smarter business decisions,” said Tom Ruggieri, CEO of Advisen. “Our overall mission as a company is to provide transparency on market conditions, including pricing, and the success of the RIMS Benchmark Survey shows an increasing demand for marketplace transparency.”
The 115-page book, available for purchase at the Online Store at www.rims.org/2004book is based on data collected in the twelve months between October 2003 & October 2004. The online survey is based on three years of data (2002-2004), which includes 20,000 insurance policies representing $8.5 billion in insurance premiums. The 2004 book reports on 15 of the 66 high-level industry groups – namely Energy, Telecommunications, Professional Services, Banks, Consumer Staples, Education, Government/Non-profit, Healthcare, Information Technology, Utilities, Consumer Discretionary, Industrials, Materials, and Non-bank Financials – as compared to the 35 lower-level industry groups available in the on-line version.
Special price discounts apply to RIMS members and those who have contributed data to the online survey. Interested parties are interested to act now as prices are due to increase this summer.
Participants who contribute insurance schedule data to the Survey can utilize “Chart-Your-Program” software to create charts and schedules of insurance programs and interactively compare their data with prior years' Survey data. Additionally, participants can use interactive benchmarking tools to compare costs and programs against continuously updated marketplace data. Visit http://rims.advisen.com/ or the RIMS Store at www.RIMS.org for details.
Through RIMS partnership with Advisen, risk management professionals can contribute their data by e-mailing current and two prior year policy schedules to Benchmark@RIMS.org. http://rims.advisen.com/Data can also be sent by fax to Advisen at 212.655.7453. Advisen will input the data, making it available for online review and comparison within days. Participant support is available by calling 1-800-655-6590.
The Risk and Insurance Management Society, Inc. (RIMS) is a not-for-profit organization dedicated to advancing the practice of risk management, a professional discipline that protects physical, financial and human resources. Founded in 1950, RIMS represents nearly 4,000 industrial, service, nonprofit, charitable, and governmental entities. The Society serves 8,000 risk management professionals around the world.
Advisen Ltd. provides insight into underwriting, marketing and purchasing commercial insurance. Advisen's web-based workstation incorporates real-time analytics and research on over 1.5 million companies, and 70 industries. Advisen currently serves nearly 350 leading commercial insurers, insurance brokers, risk management departments of major corporations, and other related organizations. Proprietary offerings of the Advisen service include Benchmarking, Proprietary Models for Company Work-ups, Company and Industry Research, Loss Analysis, Management Portfolio Analysis and Policy Comparisons. For more, visit www.advisen.com or call 212.897.4800.