Marsh tracks slowdown in global Q1 rate hikes
Marsh’s global insurance rate index increased 1% in the first quarter of this year, compared with 2% in Q4 2023, Marsh McLennan president and CEO John Doyle said on an earnings call with analysts after announcing its Q1 2024 results.
Doyle noted the index skews toward large account business and that middle-market rates are generally renewing higher.
In individual lines, global property rates increased 3%, compared with 6% in the prior quarter, casualty rates rose 3%, similar to the fourth quarter, and workers compensation rates declined in the mid-single digits, he said.
In specialty lines, financial and professional liability rates were down 7%, and cyber liability rates fell 6%, Doyle said.
Reinsurance pricing remained stable, he said.
“In the April renewal period, US property cat reinsurance rates were flat, with some decreases for accounts without losses. Loss-impacted accounts averaged increases in the 10% to 20% range,” Doyle said.
And cedents will likely see improved market conditions for 1 June Florida property cat renewals, he said.
Cedents are looking to buy more property catastrophe reinsurance coverage, added Dean Klisura, president and CEO of Guy Carpenter.
“Reinsurer appetite has increased for property cat. There’s an inflow of capital and capacity, competition at the top end of programmes; it’s been good for both buyers and sellers,” he said.
Doyle said there could be a shift in premium flows as rates stabilise. “In recent years, we’ve had higher premium growth in the captives that we manage at Marsh compared to the premium flow into the traditional market. That may change a bit now – we’ll see as markets stabilise and our clients can adjust to what the market looks like going forward,” said Doyle, as reported by results service Seeking Alpha.
Meanwhile, Marsh, which signalled last year that it was looking to develop more wholesale capabilities for the excess and surplus lines market, recently launched Victor Access, a wholesale brokerage unit of Victor, its managing general underwriter unit.
“We’re not looking to build a third-party wholesale business,” Doyle said. “We actually access most of our E&S market solutions directly today, but we want to continue to press and make sure that we can access as much of that market directly.”
He added: “We’ll continue to use wholesalers for niche expertise.”