Marsh has revealed that global commercial insurance pricing rose 15% in Q3 2021, while cyber rates continue to rise on increased losses. These were two of the key takeaways from the broker and risk advisor’s Global Insurance Market Index, which was published today.
Marsh noted that the 15% increase in global commercial insurance prices is the same rate of increase recorded in the previous quarter. However, while this is the 16th consecutive quarter of increases, the rate of increase continues to moderate in many lines of business and most geographies, suggesting that pricing increases may have peaked in Q4 2020, at 22%.
Pricing increases across most regions remained moderated due to a slower rate of increase in property insurance and directors’ and officers’ liability (D&O), according to the report. The UK saw a composite pricing increase of 27% (down from 28% in Q2 2021) and the Pacific region saw an increase of 17% (down from 23% in Q2 2021) – two factors that continued to drive the global composite rate.
Meanwhile, the rate of increase in Asia was 6% (the same as the previous quarter), 2% in LAC (down from 4%), and 10% in Continental Europe (down from 13%). The US stands as the only exception to this trend, as rates increased by 14% (up from 12% the previous quarter). Marsh highlighted that this was driven by substantial increases in cyber insurance rates and moderate increases in property and casualty rates.
Other key findings of the survey included that:
• Global property insurance pricing was up 9% on average, down from a 12% increase in Q1 2021, while casualty pricing was up 6% on average (the same as the previous two quarters).
• Pricing in financial and professional lines once again had the highest rate of increase across the major insurance product categories, at 32%, compared to 34% in the previous quarter.
• Cyber insurance pricing did not follow the moderation trend. In the US, prices increased 96% (up from 56% in Q2), and in the UK they increased 73% (up from 35% in Q2), driven by the frequency and severity of ransomware claims.
Commenting on the report, Lucy Clarke, president, Marsh Specialty and Marsh Global Placement, said: “While the risk and insurance landscape remains challenging around the world, we expect rates to continue to moderate in most lines. However, the pressure on rates in cyber insurance is likely to continue. Developing solutions for our clients in this segment remains a top priority for Marsh.”