Chris Moulder, director of general insurance at theBank of England'sPrudential Regulation Authority, said in an April 4 speech in London that theregulator expects low prices and other soft market conditions in U.K. generalinsurance to continue through 2016.

Moulder added that premium rates are continuing to declinein several lines, while extended terms and conditions are still being accepted.

"Underwriting results have been helped in the last yearby the continued absence of significant natural catastrophe losses, and prior-yearreserve releases, which have somewhat insulated many firms' results from thefull impact of current trading conditions," he said.

Moulder noted that despite these features, many businessplans still contain expectations for some growth for 2016 and the regulator donot see this as a problem. Companies seeking to expand in current marketconditions, however, must tread carefully, he said.

He also used the speech to assess Solvency II developments.Having only just "stepped over the starting line" in January, hesaid, "it remains to be seen how firms will operate as the Solvency IIframework develops over the next couple of years and we will be proportionatein our expectations during this transition period, continuing to provide firmswith feedback when appropriate."