Global commercial insurance prices increased 18% in the first quarter of 2021, according to the Global Insurance Market Index released by Marsh.
The quarter is the first to show a fall in the average rate of increase since the index reported the first rise in global rates in Q4 2017. It follows year-on-year average increases of 22% in the fourth quarter and 20% in the third quarter of 2020.
According to the index, increases across geographies moderated due to generally slower rate rises in property insurance and financial and professional lines. The UK, with a composite pricing increase of 35% (down from 44% in Q4 2020) and the Pacific region, with a 29% increase (down from 35% in Q4 2020) drove the global composite rate. The rate of increase in the US was 14% (down from 17%), in Pacific 29% (down from 35%), in Asia 8% (down from 11%), and in Latin America and the Caribbean 5% (down from 9%).
Among other findings, the survey noted:
- Global property insurance pricing was up 15% on average, down from the 20% increase in the fourth quarter 2020; casualty pricing was up 6% on average, compared to a 7% increase in the prior quarter.
- Pricing in financial and professional lines had the highest rate of increase across the major insurance product categories, at 40%, compared to 45% in the previous quarter.
- Cyber insurance pricing diverged from the trend, with prices increasing in the first quarter by 35% in the US and 29% in the UK, driven by a rise in the frequency and severity of losses. In the previous quarter, cyber rates were 17% in the US and 26% in the UK.
Commenting on the report, Lucy Clarke, President, Marsh Specialty and Marsh Global Placement, said: “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 throughout the rest of the year.”