Global commercial insurance premium rates fell 1% quarter-on-quarter in the third quarter of 2024, according to the World Insurance Market Index published by insurance broker Marsh, marking the first quarterly decline in the index since the third quarter of 2017. .
As a result, the trend of easing interest rates continues, which Marsh said is primarily due to increased competition among insurers in the global real estate market.
The UK and Pacific region had the largest overall rate declines of 5% and 6%, respectively, while the United States and Latin America and the Caribbean (LAC) had the largest overall rate increases, both at 3%. Meanwhile, interest rates in Europe remained flat.
Other findings include:
Global non-life insurance premium rates were flat in the second quarter of 2024, rose 3% in the first quarter of 2024, and then fell by 2%. Rates decreased in the US, UK, Canada, Asia, Pacific, India, Middle East and Africa (IMEA). Regions saw an increase, but Europe and Lackland saw an increase. Insurers with concentrated assets in catastrophe areas such as the Gulf of Mexico, the U.S. Atlantic Coast, and California, and those that have recently experienced above-average rate increases, generally experienced above-average rate declines. However, this was before the recent Gulf hurricanes. In the U.S., property and casualty insurance rates decreased 1% compared to a 2% increase in the previous quarter. Casualty line rates increased by 6% globally, up from 3% in each of the previous seven quarters, primarily due to concerns over mass jury verdicts in US courts . In the United States, the casualty rate increased by a significant 10%. This is primarily due to excess/umbrella rates. Excluding workers’ compensation, the increase was 14% in the US. In the U.S. umbrella and excess debt market, risk-adjusted interest rates increased by 21%, up from 10% in the previous quarter. Financial and professional interest rates fell by 7% globally, the ninth consecutive quarter of decline, with all regions recording interest rate declines. In the US, director and officer (D&O) liability rates continued to decline, but the pace of decline slowed to 4% from 5% in the previous quarter. Cyber insurance premiums decreased 6% globally, the same rate of decline as the previous two quarters, and decreased in all regions. As non-cyber insurance policies increasingly include cyber exclusions, there is an increased focus on how to address potential coverage gaps for property damage and personal injury caused by cyber events. In the US, cyber insurance rates fell by 4%.
“In the third quarter, global composite ratios declined for the first time in seven years, with three out of four major product lines declining, which is a positive development for our clients,” said Pat Donnelly. commented. Marsh, President of Marsh Specialties and Global Placements;
“We are closely monitoring the market for the impact of recent devastating storms during the North American hurricane season and will continue to provide support to our clients and the broader communities affected.”
Note: All references to rates and rate changes in this report are averages unless otherwise noted. For ease of reporting, Marsh rounds all percentage changes in interest rates to the nearest whole number.
Source: Marsh
Topics Trends Commercial Lines Business Insurance Price Trends
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