Commercial prices up average 15% globally in Q2: MarshPosted On: Jul. 27, 2021 12:50 PM CST
Commercial insurance prices increased an average of 15% globally in the second quarter, according to a report released Tuesday by Marsh LLC.
It was the 15th consecutive quarter of rate increases in the global commercial insurance market but also the third consecutive quarter to show a decline in the average rate of increase. Rates increased 18% in the first quarter and 22% in the fourth quarter of 2020.
“It appears, barring unforeseen changes in conditions, that pricing increases peaked in the fourth quarter of 2020 at 22%,” Marsh said in its report.
Property insurance pricing was up 12% on average, compared with 15% in the previous quarter and 20% in the fourth quarter of 2020.
Casualty pricing was up 6% on average in the second quarter, the same as the first quarter, and just lower than the 7% increase in last year’s fourth quarter.
Financial and professional lines saw an average rate increase of 34%, compared with 40% in the first quarter and 47% in fourth-quarter 2020, as each of the three major lines showed a slowing rate of increase.
Pricing increases for cyber insurance, however, continued to accelerate, up 56% in the U.S. in the second quarter, compared with 35% in the first quarter, and 35% in the United Kingdom, compared with 29% in the first quarter. The frequency and severity of ransomware claims drove the increases, according to Marsh.
Regionally, the U.K. saw the largest composite increase
at 28%, down from 35% in the first quarter and 44% in fourth-quarter 2020. The Pacific region was next at 23%, compared with 29% in the first quarter and 35% in last year’s final quarter.
Continental Europe pricing rose 13% in the second quarter, even with the first quarter and down from 14% in fourth quarter 2020. The U.S followed, with a 12% second-quarter increase, following 14% in the first quarter and 17% in fourth-quarter 2020.
Asia region pricing increased 6% in the second quarter, down from 8% in the first quarter and 11% in fourth-quarter 2020. Latin America pricing rose 4%, down from 5% in the first quarter and 9% in last year's fourth quarter.
“Although we expect continued pressure on pricing, especially in loss-affected lines, we also expect the general trend of moderating price increases to continue through the rest of the year,” Lucy Clarke, president, Marsh specialty and Marsh global placement, said in a statement with the report.