Asian risk managers enjoy falling rates across major product lines

Insurance rates in Asia declined 3% in the fourth quarter of 2024 with reductions across all major lines, according to Marsh. Asian risk and insurance managers enjoyed a decline in property insurance rates by 3%, according to the broker’s latest quarterly global analysis. Marsh said that based on its experience with customers in the region, insurers sought increased business with companies they perceived as having strong risk management, contributing to declining rates across most segments. Loss-impacted businesses were still reviewed “cautiously, on a case-by-case basis”, said the broker. A heightened risk appetite among insurers led to more capacity in certain segments as insurers aimed to diversify and grow their property portfolios. Marsh said that while capacity increased for most natural catastrophe-exposed areas, portfolios with less exposure typically saw higher rate reductions. “Clients continued to reassess program structures, including deductible increases and self-insurance participation, leading to interest in alternative risk transfer solutions, including parametric insurance and captives,” said Marsh. Asian casualty insurance rates declined only 1% in the fourth quarter, reported the broker. Organisations without losses that benefitted from competitive London capacity, however, experienced decreases of 5% to 10%. Available capacity remained stable, with new market entrants focusing on North American exposures, said Marsh. “Businesses with significant North American exposure faced rising insurance costs due to increased rates on primary and umbrella capacity. Despite rising claims in workers' compensation and auto liability, rates remained stable. Insurers continued to address the emerging risk of per- and polyfluoroalkyl substances (PFAS),” reported Marsh. Better news came for Asian risk and insurance managers in financial and professional lines as rates declined 9%, led by D&O, said Marsh. Limited capital market activity restricted new business opportunities, increasing competition for renewals. However, signs of capital market improvements were noted at the end of 2024, reported the broker. D&O liability insurance rates significantly influenced overall rate changes, with some markets experiencing double-digit decreases, particularly in China, where decreases averaged 20% to 25%, said Marsh. “Most countries saw lower average decreases compared to the previous quarter. New market entrants continued to expand their portfolios. Rates for financial institutions (FIs) and professional indemnity (PI) insurance remained stable,” said Marsh. Cyber insurance rates fell 11% in Asia in the fourth quarter, according to Marsh. The softening was driven primarily by increased competition from new and existing insurers, said the broker. But high-severity, low-frequency ransomware claims contributed to ongoing “portfolio volatility”, said the broker. “The risk landscape surrounding artificial intelligence (AI) is rapidly changing, presenting both opportunities and challenges in evaluating cybersecurity strategies and coverage,” commented Marsh.

Asian risk managers enjoy falling rates across major product lines

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