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Global commercial insurance prices increased 18% in the first quarter of 2021, according to a report Tuesday from Marsh.
It was the 14th consecutive quarter of price increases but the first to show a fall in the average rate of increase since fourth-quarter 2017, as the first-quarter increase was lower than the 22% seen in the fourth quarter of 2020.
The slowing in quarterly price increases appeared to be led by generally slower rate rises in property insurance and financial and professional lines.
Global property insurance pricing was up 15% on average, less than the 20% increase in the fourth quarter of 2020. First-quarter casualty pricing was up 6% on average, compared with 7% in the prior quarter.
Although financial and professional lines saw average first-quarter pricing increases of 40%, this was down from 45% in the previous quarter.
Cyber insurance pricing increases, however, continued to grow, to 35% in the U.S. from 17% in fourth-quarter 2020 and by 29% in the U.K., higher than the 26% seen in the U.K. in fourth-quarter 2020. The continued growth in rate increases was “driven by a rise in the frequency and severity of losses,” Marsh said.
This echoed comments made last week on the broker’s first-quarter earnings call.
Pricing increases moderated generally across geographies as well. First-quarter prices in the U.S. increased 14%, down from 17% in fourth-quarter 2020. In the U.K., composite pricing increased 35%, down from 44% in fourth-quarter 2020. The Pacific region saw a 29% increase, down from 35% in fourth-quarter 2020, Marsh data showed.
Pricing increases are expected to continue to generally slow for the rest of 2021, Lucy Clarke, president, Marsh Specialty and Marsh Global Placement, said in a statement with the report. “Although we will continue to see price increases in some lines and the market overall will remain challenging for our clients, we expect price increases to continue to moderate,” she said.
Average commercial insurance pricing increased 7.8% in the third quarter of 2019, the eighth consecutive quarter of average price increases, according to the Marsh Global Insurance Market Index, released Monday.