Rates fall in most regions during Q1 but rise in Europe and US: Marsh

Average commercial insurance rates fell in the UK, Asia, Canada and the Pacific during the first quarter of this year but rose 3% in both Europe and the US, with Caribbean pricing up 5% to deliver a composite global increase of just 1%, says Marsh.

Its Global Insurance Market Index finds that rates fell 2% in the UK, Asia, Canada and Pacific compared to flat pricing in the last quarter of 2023 in all these markets.

The 3% rise in Europe follows an increase of 4% in Q4 2023. The 3% increase in the US was the same as the preceding quarter. Rate increases in the Caribbean have slowed from 8% in the Q4 2023.

Marsh said the small decreases in several regions were driven by further softening in financial and professional and cyber lines, and increasing competition among insurers in the global property market.

As previously reported by Commercial Risk, global property rates increased 3%, compared with 6% in the prior quarter. Marsh said US companies with concentrations of assets in catastrophe zones such as the Gulf of Mexico, Atlantic coast and California have begun to see lower increases or even rate decreases. US property rates rose 8% on average during Q1 2024 but hardening has moderated each quarter since the 19% spike recorded in the second quarter of 2023.

Global financial and professional liability rates fell 7% in Q1 from -6% in Q4 2023, driven by the US, UK, Pacific and Canada, according to Marsh, and marking the seventh consecutive quarter that rates for the line have been cut. Global cyber rate decreases accelerated to -6% from -3% in Q4 2023.

Global casualty insurance rates increased on average by 3%, the same as the previous five quarters, largely due to concerns about the size of jury awards in the US, said Marsh.

Pat Donnelly, president of Marsh Specialty and Global Placement, said: “A continued moderation in insurance rates, and an increased appetite among insurers particularly for well-managed risks, will be welcomed by clients that continue to face major global economic and geopolitical uncertainty.”

He added: “We are working closely with our clients to ensure they have the right tools to navigate these challenges successfully and benefit from the continued improvement in market conditions.”