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US Insurance Market Pricing

The Global Insurance Market Index is our proprietary measure of commercial insurance rate changes at renewal. Below are insights into the US insurance market. 

Q4 2023 

US pricing: Cyber and financial and professional rates continue to decrease

Insurance rates in the fourth quarter of 2023 in the US increased by 3%. 

US fourth quarter 2023

US composite insurance rate change 

US property

US property insurance rates continue to increase

Property insurance rates increased by 11%; it was the twenty-fifth consecutive quarter in which rates rose. 

  • Rate increases were driven by rising reinsurance and capital costs coupled with three years of strong demand, limited new capacity, and loss activity.
  • Risks with limited natural catastrophe exposure and stable incumbent capacity typically experienced better results than did risks with losses and/or concentrations of assets in CAT zones, including the Gulf of Mexico, the Atlantic coast, and California.
  • Underwriters scrutinized CAT deductibles, together with limitations of cover for non-physical damage, cyber, and communicable disease.
  • Clients generally retained more risk through increased deductibles, or through alternative risk transfer including captives, parametric, or structured solutions.

US casualty

Casualty market remains competitive

Casualty insurance rates increased 3%; excluding workers’ compensation, the increase was 5%.  

  • Casualty markets remained competitive, particularly for workers’ compensation.
  • Auto liability losses continued, with jury awards escalating.
  • Excess liability rates increased 7%, compared to 4% in the prior quarter; insurers focused on large exposures.

US financial and professional lines

D&O rates continue to decline

Financial and professional lines rates decreased 6%. 

  • Directors and officers (D&O) liability insurance for publicly traded companies declined 8%; insurer competition remained strong.
    • The size of rate decline eased, especially for programs that had received large decreases previously.
    • Many insurers continue to evaluate their placement in excess towers, with some seeking to move out of higher layers.
  • Fiduciary rates increased 2% as Employee Retirement Security Act (ERISA) 401k plan excessive fee litigation continued to drive losses.
    • New insurers  offered lower retentions, on some programs. 
  • Errors and omissions (E&O) rates were flat. 
  • Financial institutions (FIs) rates decreased 5%.

Cyber rates decline; ransomware attacks increase

Cyber insurance rates decreased 4% in the quarter. 

  • Ransomware attacks increased in frequency, sophistication, and severity; evolving privacy regulations also led to increased claims.
  • Capacity was available, especially for excess programs; managing general agents (MGAs) continued to bring new capacity into the market. 
  • Catastrophic cyber risk is a significant concern for insurers and insureds; understanding and quantifying exposure to war and aggregated cyber incidents, together with the supply chain risks associated with each, is challenging, but essential.

This document and any recommendations, analysis, or advice provided by Marsh (collectively, the ‘Marsh Analysis’) are not intended to be taken as advice regarding any individual situation and should not be relied upon as such. This document contains proprietary, confidential information of Marsh and may not be shared with any third party, including other insurance producers, without Marsh’s prior written consent. Any statements concerning actuarial, tax, accounting, or legal matters are based solely on our experience as insurance brokers and risk consultants and are not to be relied upon as actuarial, accounting, tax, or legal advice, for which you should consult your own professional advisors. Any modelling, analytics, or projections are subject to inherent uncertainty, and the Marsh Analysis could be materially affected if any underlying assumptions, conditions, information, or factors are inaccurate or incomplete or should change. The information contained herein is based on sources we believe reliable, but we make no representation or warranty as to its accuracy. Except as may be set forth in an agreement between you and Marsh, Marsh shall have no obligation to update the Marsh Analysis and shall have no liability to you or any other party with regard to the Marsh Analysis or to any services provided by a third party to you or Marsh. Marsh makes no representation or warranty concerning the application of policy wordings or the financial condition or solvency of insurers or re-insurers. Marsh makes no assurances regarding the availability, cost, or terms of insurance coverage. LCPA 24/031.

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