NEW YORK (

TheStreet

) -- Expect the property/casualty insurers to raise rates on personal lines insurance in 2011 after holding the price line for the past two years.

Sluggish demand -- and exposure from multiple catastrophes this year -- are dragging down top line growth in the industry and causing most insurers to boost rates, according to a report from

Moody's

(MCO) - Get Report

. Insurers such as

Allstate

(ALL) - Get Report

and

State Farm

have already announced rate hikes in some states, according to published reports.

"Many companies will try to raise rates to address profitability in homeowners and auto lines. There has been a lot of

catastrophe activity below the major hurricane level, particularly from storms out west, and companies are trying to address that by increasing rates," says Enrico Leo, assistant vice president at Moody's.

Homeowners and small businesses have been particularly unprofitable, said Sarah Hibler, senior vice president Moody's.

"Broadly, you could take a look at pretty much anyone's earnings comments and see that companies are raising rates in the homeowners line," said Hibler.

Separately, many P/C companies will also be looking at ways to decrease their exposure in order to grow their top line. P/C insurers' earnings have been benefiting from reserve releases from some lines and many insurers hold a smaller capital cushion than in the past, the Moody's report said.

"To extent companies have been in a capitalization position we would expect them to announce buybacks. Allstate just announced a buyback program of one billion dollars," Leo added.

--Written by Maria Woehr in New York.

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