Rates poised for increase

The SFRI increased slightly in July over June. Standard markets remain aggressive in South Florida and willing to take on more cat exposed risks. However, for the first time, rates seem poised to increase. We expect to see 5-10% increases over the next 6 months. Although carriers have been talking about the hard market since last October, there has been no real action because capacity has not been an issue. However, several large players have stopped increasing their exposures recently. In addition there are positive signs of economic recovery. Real decreases in capacity combined with economic optimism is the formula needed to bring rates up to actuarially sound levels. And a storm could be the catalyst to get them moving.