Rates increased in the Pacific by 5% and in Asia by 2%, with cyber pricing increasing 53% overall
Global commercial insurance prices increased 6% in the third quarter of 2022 (down from an 9% increase in Q2), according to the Global Insurance Market Index released by Marsh, continuing a trend of moderating increases that began in Q1 2021.
Rates increased in the Pacific by 5% (down from 7%), and in Asia by 2% (down from 3%).
While this is the 20th consecutive quarter of increases, pricing moderated in most regions driven by the first decrease in financial and professional lines since Q3 2017.
Lucy Clarke, president, Marsh Specialty and Global Placement, Marsh said: “The global business environment remains tough for clients. Ongoing inflation and geopolitical instability are affecting all sectors and we expect even more challenging conditions in the already strained property catastrophe market following Hurricane Ian.
“We are working closely with our clients to get the best possible outcomes from the market, as well as explore the whole range of options available to assess and address their risks including alternative and captive solutions.”
D&O pricing eases off
Pricing increases across most regions moderated due to an overall decrease in certain financial and professional lines, most notably directors and officers insurance. The US, with a composite pricing increase of 5% (down from 10% in Q2 of 2022), experienced the largest moderation in average price increases.
Among other findings, the survey noted:
- Global property insurance pricing was up 6% on average in the third quarter of 2022, the same level as the previous quarter; casualty pricing was up 4% on average, compared to 6% in the previous quarter.
- Globally, cyber insurance pricing increased 53% in Q3. In the largest cyber insurance markets, the rate of increase continued to moderate with prices rising by 48% in the US and 66% in the UK, compared to 79% and 68%, respectively, in the prior quarter.
- The exclusion of cyber meant that, for the first time since 2017, overall pricing in financial and professional lines fell by 1% in Q3, compared to a 16% increase in Q2; a figure that included cyber. The result this quarter was driven by decreases in the US, UK and Australia and moderating rates of increase elsewhere.
- Valuation continues to be a focal point for insurers at renewal, driven by concerns about inflation.