2006 New Markets Report

New insurance products seemed to be in great supply in 2006 as the market for most lines continued to turn toward softer times. No market was as robust as professional and management liability lines, according to a review of new markets published on Insurance Journal’s Web site during 2006.

This exclusive 2006 New Markets Report is a collection of some the new insurance products launched in most states during 2006. Single state or regional products are not listed in this report but can be found at: www.insurancejournal.com.

While professional and management liability products led the year for national new products, workers’ compensation and even property lines witnessed increased activity and entrants on a regional level, says Richard Kerr, president of Dallas, Texas-based MarketScout.

“Workers’ comp is very active,” Kerr said. “There are a lot of new regional carriers entering into the mix, competing with some of the very large ‘A+’ rated stock companies and they are carving into that market share.” Kerr says the industry will see “literally” billions of dollars of workers” comp premiums move from one carrier to another. “Most of the movement will be from the very larger carriers to the smaller upstart carriers who don’t have legacy issues and are in the market trying to capitalize on reforms,” he maintained.

Adam Dunford, associate publisher of MyNewMarkets.com, a free community-based Web site devoted to helping insurance professionals find and promote insurance markets, says that while MyNewMarkets.com remains in a beta-test phase today, one of the most common searches by its user members is for workers’ comp markets. MyNewMarkets.com is a division of Wells Publishing Inc., the operator of Insurance Journal.

In commercial lines, the tipping point for carriers developing new products has been their use of predictive analytics in commercial underwriting, says Joe Harrington, director, corporate communications for the Wheaton, Ill.-based American Association of Insurance Services. Predictive analytics, already popular in personal lines, allows carriers to segment markets beyond typical classes and develop multiple pricing points. “Clearly having class-based underwriting knowledge is still going to be of great value, but carriers that have relied on their class-based knowledge will find pressure from others,” he said. Harrington added that the market may experience competition not seen in the past. “It remains to be seen how prudent this competitive dynamic will be, but it will clearly come about,” said Harrington.

The following are some highlights from the Insurance Journal Special Report: 2006 New Markets in the P&C Insurance Industry as of press time. The complete report is available at www.insuancejournal.com.

Topics Trends Carriers Workers' Compensation