Term Of The Day – Soft Market
Part of a cycle, the term soft market describes the time when premiums are low, profits dwindle, and competition increases. As the number of claims increase, insurance carriers can no longer afford to lower premiums to increase volume. When this happens, the soft market portion of the cycle comes to an end.
Agents and underwriters also use the term buyers’ market.
The term in general economics means that prices remain low due to more sellers than buyers.