Conning Research: In Personal Lines, Intense but Disciplined Competition Prevails

Insurers invest in data modeling and branding; external threats wait on the horizon

(Hartford, CT) July 5, 2005 – Automobile and Homeowners insurance market leaders are employing a new mix of tactics as they compete for growth, according to two new publications by Conning Research and Consulting, Inc.

Personal lines market leaders are more aware now than last cycle of the price points that damage profits,” said Bruce Hale, analyst at Conning Research & Consulting, Inc. “Modest price cuts are common in personal automobile, while the homeowners line is showing flat to minimal rate increases, in most states. These measured actions are affordable for insurers because of recent strong profits. The aggressive competition is occurring in data modeling and branding. Market leaders are outsmarting their rivals in risk selection and staking a superior position in the mind of the consumer.”

Conning Research & Consulting recently released its Property-Casualty Industry Insights for personal lines. Released semi-annually, these mid-year reports for Personal Automobile and Homeowners review performance and contributing factors.

“While the industry so far has not engaged in the usual self-inflicted erosion of profits, there are some external long-term threats on the horizon,.” said Stephan Christiansen, director of research at Conning Research. “In 2006, we should see whether the federal study of credit scoring will affirm this core element of predictive modeling or lead to operational disruptions. For the homeowners line, continued escalation of home values is raising the chances for a bubble burst, with negative implications for insurance to value ratios.”

“Expense Revolution: Is the Property-Casualty Industry Overdue?” is available for sale from Conning Research & Consulting, Inc., by calling (888) 707-1177 or by visiting the company’s Web site at

About Conning Research & Consulting, Inc.

The Conning name has represented excellence in independent insurance industry research for more than 90 years. As a result of its wealth of experience and intimate knowledge of the insurance industry, Conning understands industry challenges and opportunities and can provide in-depth insights and analyses. Conning is headquartered in Hartford, CT, where it provides both public and proprietary research as well as consulting services to the financial services industry.