Price cutting and deteriorating profitability will remain the dominant features of the general insurance industry for another 18 months to two years, a leading sell-side analyst forecast yesterday.JP Morgan insurance analyst Shane Fitzgerald said insurers were losing money underwriting some lines of business and other classes were moving into loss. Things were moving to a point where insurers would have to reassess their strategies.Fitzgerald's view is backed up by the findings of the latest JP Morgan Deloitte general insurance industry survey, released yesterday. Survey respondents, representing 75 per cent of the industry, said they expected premium rates to fall in 2008 but to start picking up in 2009.The business line hardest hit by competition is commercial motor. The average combined ratio for survey respondents was 103 per cent (the combined ratio is the sum of the loss ratio and the expense ratio. A combined ratio of more than 100 per cent means the insurer is making an underwriting loss).The average combined ratio for underwriters of compulsory third party in New South Wales reached 100 per cent this year and is forecast to climb to 109 per cent in 2008. Other business lines whose combined ratios are approaching 100 per cent include CTP in Queensland, workers compensation, commercial property and professional indemnity.Fitzgerald said: "The industry's overall combined ratio has increased from 91 per cent in 2006 to 94 per cent this year. "However, combined ratios in the commercial classes remain attractive and will continue to drive competition."The general insurance leader at Trowbridge Deloitte, Elaine Collins, said insurers had maintained profitability by releasing reserves that were built up in the good years.Premium rates were cut by an average of eight per cent this year, with the biggest cuts in workers compensation (down 14 per cent in Western Australia), CTP (down 12 per cent in NSW) liability (down 10 per cent) and commercial  property (down nine per cent).Fitzgerald said the combination of dwindling reserves and rising combined ratios would  force the industry to impose some discipline.Fitzgerald said one of the industry myths was that price competition was being driven by foreign underwriters coming into the market. He said it was true that more Lloyd's syndicates were operating in Australia but the local companies were all "in the game".