Bruising competition may be a far greater risk for insurers than problems with subprime mortgages are.

Insurance company executives gave that assessment here this week when they participated in an informal survey during an insurance industry conference organized by KPMG.

Only 5% of the 270 survey participants identified subprime mortgage risk as the most significant risk facing the industry.

That was up from none in 2006, when KPMG did not think to ask about subprime risk.

“Pricing risk” – the risk that efforts to make sales will lead underwriters to set prices that are too low – was by far the most popular answer.

The percentage of executives identifying pricing risk as the most significant risk increased to 56% this year, up from 49% in 2006.

Although 51% of the participants said the effect of the subprime market woes on insurers’ investments would be significantly negative, only 4% of the participants said the effect would be extremely negative.

About 33% of the participants said their companies are extremely confident about their ability to understand their exposure to subprime losses and related losses, while 18% said they do not know whether they can do so and 9% are not at all confident about their ability to analyze subprime exposure.

The percentage of executives predicting that their companies will do better or significantly better than last year has fallen to 53%, from 59%.

The percentage of participants who say the rate of mergers and acquisitions will increase has increased to 59%, from 38%.