Asian rates decline across major lines

Commercial and corporate insurance rates in Asia fell 3% in the first quarter of 2025, according to Marsh’s Q1 analysis of the region based on a mix of its customers. The first quarter of 2025 marked the third consecutive quarter of global rate decline (-3%), according to Marsh’s Global Insurance Market Index, following seven years of quarterly increases. “The breadth of declines – seen in all regions and product lines apart from casualty – is a positive for our clients,” said John Donnelly, president, Global Placement, Marsh. In Asia, property insurance rates fell as interest in alternative solutions and captives continued to rise, said the broker. Property insurance rates declined 3% across the region. Marsh warned risk managers, however, that insurers continued to exercise strict underwriting discipline – particularly for industries perceived as high risk, distressed businesses, and those impacted by losses – and stressed need for accurate valuations. The broker said that the involvement of international and wholesale markets has contributed to the competitive environment, leading to generally improved outcomes for clients across local, regional, and global insurance programs. Marsh said that there was an increase in the offering of long-term agreements (LTAs), which now frequently include provisions for rate reductions and low-claims bonuses. “Clients actively reviewed deductibles and self-insurance options, resulting in a growing interest in alternative risk transfer solutions, such as parametric insurance and captive insurance,” it said. Casualty rates fell by 2% across the region on the back of stable capacity, according to Marsh’s latest analysis. Organisations without losses and those benefitting from competitive capacity in London markets typically experienced more significant rate decreases, ranging from 5% to 10%. Businesses with substantial US exposure, however, faced rising rates, driven by increases for primary and umbrella coverage, reported Marsh. Workers' compensation rates remained stable while auto liability rates were generally stable, although increases of 5% to 10% were experienced in Japan and Thailand, indicating regional variations in risk assessments. “Insurers adopted a diversified approach to underwriting risks associated with per- and polyfluoroalkyl substances (PFAS), with some applying broad exclusions while others opted for selective or partial exclusions,” said Marsh. Financial and professional lines rates declined by a further healthy 8% in Asia, said the broker. This was driven by limited activity in capital markets, restricted new business opportunities for insurers, and increased competition for renewal business, reported Marsh. “Directors and officers (D&O) liability insurance rates were, again, a significant factor in overall rate changes, with average reductions ranging from 10% to 20% across the region. Professional indemnity (PI) and financial institutions (FI) rates moderated, with decreases ranging from 5% to 10%, reflecting the competitive market,” said Marsh. Asian cyber rates also fell by 8% as capacity levels rose, said Marsh. The ongoing reduction in cyber rates was also driven by heightened insurer competition, fuelled by new entries into the market and increased capacity from existing players, said Marsh. The severity and sophistication of ransomware attacks, however, remained a significant concern for insurers, particularly around data encryption and business interruption. “Insurers and reinsurers actively reviewed war and infrastructure exclusions. There was an increase in discussions surrounding physical damage coverage and ‘silent cyber’, leading to the introduction of broader property damage offerings in the region,” reported Marsh.

Asian rates decline across major lines

Marsh reports good news for Asian risk managers

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