Insurance rates are likely to fall over 2006, including for property policies which have been rising in price since last year?s hurricanes, a research firm says.

Property insurance rates climbed 6.9 percent during the first three months of the year, mostly in hurricane-prone areas, while some other types of policies were less expensive, said David Bradford, senior vice president of Advisen Ltd., a firm that provides data to the industry.

Mr. Bradford unveiled the findings at the annual Risk and Insurance Management Society Inc.?s conference being held this week in Hawaii. RIMS attracts thousands of risk managers from across North America.

The prediction that insurance rates will soften, or fall, is based on the fact the property-casualty insurance sector?s financial strength has remained strong. The sector turned a profit in 2005 despite large hurricane losses, said Mr. Bradford. Insurers are expected to sustain hurricane losses in the region of $60 billion, he added.

Insurers also experienced ?strong growth in policyholders? surplus, indicating that rate levels are still stalwart and capacity is abundant in most lines,? he said, strengthening the firm?s view that the commercial insurance market, including property rates, are likely to soften.

The view flies in the face of some others? expectations, including the management of some of the new Bermuda companies that formed in the wake of the 2005 hurricanes, who are banking on rates rising through the year.

At least two types of policies, workers? compensation and directors and officers liability, saw rates decline, in keeping with Advisen?s market view. During the first quarter, D&O rates fell by 3.5 percent and policies to cover claims to workers injured on the job were about three percent less expensive.

Along with rising property rates, general liability insurance was 5.1 percent more expensive to buy in the first quarter.

?The property pricing increases were a knee-jerk reaction by underwriters to the hurricane catastrophe losses, but probably will not be sustainable,? said Mr. Bradford. ?Conditions are ripe for softening.?