Global commercial insurance prices in largest increase

Price movement driven by leaps in property insurance rates and financial and professional lines

Global commercial insurance prices in largest increase

Insurance News

By Ryan Smith

Global average commercial insurance prices rose by 19% in the second quarter of 2020, according to a new report by Marsh. The increase, the largest since Marsh’s Global Insurance Market Index was released in 2012, follows average year-over-year increases of 14% in Q1 and 11% in the fourth quarter of 2019.

Average price increases were driven primarily by increases in property insurance rates and financial and professional lines, Marsh reported. Other findings of the survey included:

  • Global property insurance was up by 19% and global financial and professional lines rose 37%, while global casualty pricing saw a 7% average increase.
  • Composite pricing in Q2 increased in all geographic areas for the seventh consecutive quarter.
  • The US (18%), UK (31%), Continental Europe (15%) and Pacific (31%) regions all posted double-digit pricing increases. The increases in these regions were largely driven by increases in property and directors and officers coverages.
  • Some D&O markets saw large increases. For example, US public-company D&O prices rose 59% on average, with more than 90% of clients seeing an increase. In the UK, D&O pricing increases averaged more than 100%.

“While pricing movements this quarter were impacted by losses related to COVID-19, other large losses contributed to overall pricing pressures,” said Dean Klisura, president of global placement and advisory at Marsh. “As insurers continue to work through claims in property and D&O, and with the full cost of COVID-19 still developing, upward pressure on pricing is anticipated for the balance of 2020.”

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