Risk managers in India, Middle East, and Africa suffer higher rates in Q4: Marsh

Marsh’s latest Global Insurance Market Index found that insurance rates in the fourth quarter of 2024 increased 1% in the India, Middle East and Africa (IMEA) region in the fourth quarter of last year. The broker found that property insurance rates in the region increased by 3%. “Where rates increased at renewal, the primary drivers were higher reinsurance and capital costs in catastrophe-exposed portfolios, heightened demand for capacity, and ongoing loss activity from floods in the United Arab Emirates (UAE) and significant losses in Saudi Arabia, India and Africa,” said Marsh. The broker said that non-catastrophe-exposed portfolios in India experienced rate reductions of up to 40% due to the de-tariff implemented in the third quarter. Saudi Arabia experienced rate decreases of approximately 10%, while South Africa saw minor increases of up to 5%. In contrast, the UAE continued to see rate increases of 10% to 15% due to flooding losses, said the broker. Marsh said that catastrophe-exposed sectors and high-hazard industries including chemical, food, waste and recycling faced capacity constraints and rate hikes of up to 25%. “Insurers sought to impose strict terms and conditions, including natural catastrophe aggregates, deductibles, limitations on contingent business interruption (CBI) extensions, and increased scrutiny of cyber coverage and terrorism-related risks,” said Marsh. The broker noted that regional players and multinational reinsurers are eager to expand their property portfolios across IMEA, a region that is largely dominated by the reinsurers. Casualty insurance rates increased 1% across the IMEA region. Marsh said that capacity-driven risks saw “modest” increases of up to 5%, while non-complex, lower-capacity risks experienced reductions of 5% to 10%. It said that rates in India, the UAE and South Africa remained stable, while Saudi Arabia experienced increases up to 5%. US exposures significantly influenced appetite and capacity deployment, said Marsh. “New capacity in the region, particularly in reinsurance, fostered competition, while insurers remained cautious regarding loss-impacted and heavily exposed risks, leading to increased underwriting information requirements,” noted Marsh. “Various insurers in India and the Middle East implemented growth strategies, intensifying competition, while the African market remained stable,” added the broker. Marsh reported that financial and professional lines rates declined 5% across the region. Directors and officers (D&O) liability insurance rates varied by region: India experienced decreases ranging from 5% to 10%; South Africa experienced increases ranging from 10% to 15%; The UAE and Saudi Arabia saw average decreases ranging from 15% to 20%. “South Africa is seeing efforts to reprice historically underpriced coverage. Financial institution rates in the Middle East decreased by 10% to 15%, with increased capacity from London and Dubai. Rates in South Africa and India remained stable, with insurers adjusting capacity on layered programs,” reported Marsh. The broker said that the professional indemnity market in India remained stable. Cyber insurance rates decreased 18% across the region. “The Middle East experienced declines of over 37%, India remained stable, and South Africa saw increases of 15% to 20%. Incumbent insurers sought to retain clients, and new capacity, particularly in excess and primary layers, entered the market,” explained Marsh. “In the Middle East, increased capacity from new entrants and competitive pricing was evident; insurers in India and Africa have been more cautious, but a shift in approach was beginning to emerge,” added the broker.

Risk managers in India, Middle East, and Africa suffer higher rates in Q4: Marsh

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