A new market index report by Marsh, a global leader in insurance broking and risk management, has indicated that the global commercial insurance prices increased 15% in the second quarter of 2021, representing the 15th consecutive quarter of rate increases in the global commercial insurance market.
In addition, the insurance pricing surge also marked the third consecutive quarter to show a fall in the average rate of increase and followed year-on-year (Y-o-Y) average increases of 18% in Q1and 22% in Q4 of financial year 2020.
The risk management company in the report highlighted how increases across all geo-zones moderated due to slower rate rises in property insurance outside of Europe, and financial and professional lines, excluding Asia and Latin America and the Caribbean (LAC).
A further analysis of the report showed that the UK, with a composite pricing increase of 28% and the Pacific region, with a 23% increase sustained the drive of the global composite rate.
According to the insurance broking firm, the rate of increase in the US was down 14% at 12%, in Asia 6% down from 8%, in LAC 4% down from 5%, and in Continental Europe 13% down from 15%.
The market index report reflected that global property insurance pricing was up 12% on average, while casualty pricing was up 6% on average, which was the same as the prior quarter.
Also, the report showed how cyber insurance pricing again diverged from the moderation trend. For instance, the findings indicated that in the U.S, prices increased 56% in Q2 compared to 35% in Q1, and 35% in the UK, compared to 29% in first quarter.
The report attributed the rise in insurance pricing largely to frequency and severity of ransomware claims.
In her remarks on the report, President, Marsh Specialty and Marsh Global Placement, Lucy Clarke, said: “Clients continue to face a challenging risk and insurance landscape as the global economy emerges from the pandemic.
“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”, Clarke added.
