soft market

Noun

soft market (plural soft markets)

1. An economic environment in which insurers lower their prices.
   • Property-liability insurance markets have been characterized historically by “soft” markets, in which prices are stable or falling and coverage is readily available, followed by “hard” markets, in which prices rise rapidly and availability declines.2000, Scott Harrington, Patricia Danzon, “The Economics of Liability Insurance”, in Georges Dionne, editor, Handbook of Insurance, Springer Science+Business Media, →DOI, →ISBN, page 296
   • Insurers are reluctant to pay out retained earnings during soft markets because of the difficulty of raising capital again when the market enters the next hard market phase, leading to excess capcaity and downward pressure on prices.2009, J. David Cummins, Olivier Mahul, “Appendix 8: Review of the Catastrophe Reinsurance Market”, in Catastrophe Risk Financing in Developing Countries: Principles for Public Intervention, The World...