RIMS Benchmark Survey Book Records Total Cost of Risk Down in 2005

Annual Publication Illustrates Continuous Slide of Major Lines; Property Lines Affected by Hurricanes Though Influence Appears Short-lived

New York, May 25, 2006 — According to the 2005 Annual Benchmark Survey from the Risk and Insurance Management Society (RIMS), the commercial insurance industry remained a buyers’ market in 2005, and shows no signs of hardening any time soon. The 2005 RIMS Benchmark Survey book provides risk managers objective and actionable insurance market information based on the insurance programs of more than 1,400 participants from the U.S. and Canada – the largest number of respondents in 25 years of benchmark surveys.

Insurance professionals use the RIMS Benchmark Survey to monitor and evaluate programs, help negotiate program costs and design, and navigate the latest risk management trends. This book is the annual summary of the online version of the RIMS Benchmark Survey that is updated quarterly throughout the year. The survey is produced and published by Advisen Ltd., which collects and analyzes the data and provides easy-to-use, online interactive tools and services.

The 2005 survey revealed that the total cost of risk (TCOR) was down for the first time since 2001. Following 9/11, insurance costs skyrocketed through 2003. While insurance costs fell in most lines in 2004, higher retained losses and rising worker compensation costs through the first half of the year pushed TCOR up marginally. However, in 2005, the median TCOR fell about 11 percent driven almost completely by lower insurance costs, attributed by Advisen analysts to abundant underwriting capacity which led to heightened competition. Despite the devastation caused by Hurricanes Rita, Wilma and Katrina, the property & casualty insurance industry posted approximately $55 billion in earnings in 2005.

“While the effects of these hurricanes will be felt by the people of the Gulf Coast region for years to come, their impact on the overall insurance market is much less dramatic and long-lasting,” said David Bradford, editor-in-chief, Advisen Ltd. “Consolidated industry policyholders’ surplus, the measure of aggregate insurance industry capacity, rose in 2005 despite the catastrophe losses, and we believe this excess capacity will cause premium prices to decrease.”

In the Executive Summary of the survey, Bradford notes almost every class of business tracked for the survey showed a decrease in the median premium per $1,000 of revenues for the year. Viewed on a quarter-by-quarter basis, property premiums experienced an upturn in the fourth quarter but it is likely the increase is only a short-term response to catastrophe losses.

“RIMS Benchmark Survey provides data that optimizes a risk manager’s ability to structure insurance programs and compare the cost to others in the industry group to support recommendations to senior management,” said Karen Beier, member, RIMS Board of Directors, Membership and Chapter Services portfolio. “That’s particularly valuable when the market is in flux, as it is right now.”

The 104-page book reveals data collected in the 12 months between October 2004 and October 2005 and covers 15 high-level industry groups (Energy, Telecommunications, Professional Services, Banks, Consumer Staples, Education, Government/Non-profit, Healthcare, Information Technology, Utilities, Consumer Discretionary, Industrials, Materials and Non-bank Financials). The online survey provides an expanded view of the insurance industry based on three years of data (2003-2005), which includes 20,000 insurance programs representing $8.5 billion in insurance premiums. The survey also provides a broader view of insurance groups, covering 35 lower-level industry groups.

The book and survey are available for purchase at http://www.RIMS.org/benchmark or by calling 800.655.6590. Special price discounts apply to RIMS members and survey data contributors.

About The Benchmark Survey

Risk managers who contribute insurance schedule data to the survey can benchmark both the structure of their commercial insurance programs and the cost of insuring their risk against a highly-relevant group of similar companies. Additionally, survey respondents can use software personalized and configured for their needs to view detailed schedules of insurance programs for current and past years and to create full-color charts. Both benchmark charts and program charts download into any presentation for senior management.

The results of the RIMS Benchmark Survey are available online, published continuously throughout the year, and in a book, published once each year. Visit www.RIMS.org/benchmark for details. Risk management professionals can contribute their data by e-mailing current and prior year policy schedules to Benchmark@RIMS.org. Corporate risk manager participation in the RIMS Benchmark Survey has never been higher, especially with the recent announcement by Advisen that a broker authorization letter is available on www.rims.org/brokerform or by calling +1.800.655.6590. Data can also be sent by fax to Advisen at +1.212.655.7453. 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.

About RIMS

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 3,900 industrial, service, nonprofit, charitable, and governmental entities. The Society serves 9,600 risk management professionals around the world.

About Advisen

Advisen Ltd. provides carriers, brokers, risk managers and other insurance professionals with an integrated analytics and information platform for insight to make key commercial insurance and risk management decisions. Advisen’s over 400 clients access the on-demand, web-based service for research on 275,000 program transactions, 180,000 claims, 80 industries and 1.7 million companies and organizations. Advisen member firms gain higher value on the above information through analytic functions such as: benchmarking, work-up and submission templates, insurance program management, policy & law comparisons, loss & exposure analysis, corporate governance, financial metrics, news and significant case data. Over 40,000 insurance professionals use Advisen every day. Visit www.advisen.com or call 212.897.4800.