An article posted by BusinessInsurance.com reviewed the Property/Casualty Insurance Joint Industry Forum held in January 2012 found some cautionary tales expounded.  Numerous speakers mentioned that P&C rates are under pressure to be moved upward as a result of worldwide catastrophes, such as historically deadly earthquakes, tsunamis and hurricanes.

These losses when combined with continued low interest rates resulting in low returns on investments, leave insurers concerned about surpluses needed for claims.  Insurance companies are “seriously rethinking” their exposures, and commercial rate particularly those involving catastrophe risks clearly are rising, said Jay Gelb, managing director of Barclays Capital. Mr. Gelb spoke during the events “Experts Panel: View From the Outside Looking In.”

In addition, the low-interest-rate environment continues to be a concern for insurers and reinsurers and will have an impact on earnings for at least the next few years, Mr. Gelb said.

A Swiss Re executive said. “Rates have to move up. There's just not enough income coming in to replenish capital.”

Meanwhile, the survey of attendees found that 72% believe the industry is in the early stages of a hard market, while 75% of the respondents said they expect an improvement in profitability.

In addition, 67% of the respondents said they believe premium growth will be higher, 31% believe it will remain flat, and only 2% believe it will decline.

Seventy-eight percent of the respondents said they believe the industry's combined ratio will be lower in 2012 than it was in 2011.

The survey was based on the responses of approximately 40% of the nearly 250 industry representatives who attended the forum.