Commercial markets softening in Magnolia State, agents say

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Published: March 10,2008

The commercial insurance market is currently a soft one, according to some of the state’s independent agents. That’s good news for businesses who can find bargains even though personal insurance is on a different track.

Ronnie Tubertini, president of SouthGroup Insurance Services, reports “a very competitive insurance environment in Mississippi these days, and that’s good for customers. Even with out propensity toward storms, it’s still an attractive state in which to do business.”

A lot of that attractiveness is a result of tort reform and the legal environment, he says, helping to put the state in that competitive way. “Commercial insurance pricing is lower than five years ago,” he says. “It probably took a while for national companies to recognize it but regional companies did so immediately.”

Writing new business
De

bie Shempert of Tupelo’s Renasant Insurance Group also categorizes the current commercial insurance market as soft. “There are not a lot of renewals going up,” she says. “Our business clients are happy, and we’re writing a lot of new business. Personal insurance doesn’t seem to take the dips of commercial where there are more things we can give credit for, such as safety programs.”

On the personal side, she thinks many clients are not aware of their coverage until they receive renewal notices. One product she’s seeing become more prevalent is long-term care coverage, most probably a reflection of the country’s aging population.

“It’s been around for a while but we didn’t hear much about it,” Shempert says. “People are starting to be more interested in it. Our agency’s Life and Health Department wrote a lot of it last year. I’ve started asking my clients about it. As a trend, I think we will see it become more important. It won’t go away, and more agents and clients are talking about it.”

As a small town agent, Keith Bills of Grenada sells all lines of insurance but is a little heavier on the commercial side, where he sees a soft market, too.

“There are not a lot of complaints from business clients right now,” he says. “A soft market means a lot of companies are writing coverage and wanting to write business here. That benefits customers, giving them more options. There’s more available now.”

Bills is serving as president of the Mississippi Independent Insurance Agents Association, which has a market task force that works to maintain carriers in the state and tries to attract new ones.

“We try to stay on the forefront of what’s available in the state and with legislation,” he says. “Legislatively, it’s a quiet year with no major issues. We have met with the new insurance commissioner and will work with him.”

The state’s insurer of last resort, the Wind Storm Underwriting Association, commonly called the Wind Pool, was on the front burner of last year’s session and is a topic of concern for residents of the coastal counties. “Coverage is available through the Wind Pool but there are not as many companies writing it as we would like,” Tubertini says.

On the horizon

Bills and Shempert know of no new products at this time, but Shempert says companies are looking at their products and tweaking them to service client needs.

Tubertini’s insurance group has offices throughout the state, except the Coast. The branch offices in the Delta are seeing the larger cities such as Cleveland, Clarksdale and Greenwood have a positive business environment. “Our Delta offices are doing very well,” he says. “We recognize that the economic climate could be better but it varies from city to city.”

He thinks the competitive pricing for commercial coverage will continue through this year and 2009. “I don’t see any increases in commercial costs,” he says. “Individual costs are not quite as bright. Hurricane Katrina had more of a long-term impact, primarily on homes and cars. For that, we’ve seen an opposite impact with continuous increases of 5%, 10% and 20% — not huge ones at one time.”

This long-time agent says most companies have now taken their increases based on Katrina, but there is some difficulty in getting earthquake insurance in the Northwest part of the state.

“Insurance companies see the New Madrid Fault as a threat in that part of the state,” he says. “We can write the coverage, but it’s expensive. Many residents don’t believe it’s a potential threat and are not buying coverage.”

Contact MBJ contributing writer Lynn Lofton at llofton656@aol.com.

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