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.”