What is a distinguishing feature of a soft market compared to a hard market in insurance?

In insurance, a soft market is characterized by increased competition and lower rates. During a soft market, insurers are more willing to write policies, leading to greater availability of coverage as they strive to attract new clients and retain existing ones. This competitive environment typically results in lower premiums, making insurance more affordable for consumers. Additionally, insurers may offer more favorable terms and conditions, which can enhance the attractiveness of their policies.

In contrast, the other options describe conditions commonly found in a hard market. For example, a hard market usually involves higher premiums and stricter underwriting criteria as insurers become more cautious, which is the opposite of the competitive landscape of a soft market. Stricter regulations and reduced capacity also pertain to hard market conditions where insurers may limit the amount of risk they are willing to take on. Lastly, limited options and fewer policies available signify a hard market, where fewer insurers are operating due to the increased risk environment. Therefore, the distinguishing feature of a soft market is indeed the increased competition and lower rates.