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Global Insurance Market Update

UK Pricing Q1 2022

Insurance pricing in the first quarter of 2022 in the UK increased 20%, compared to 22% in the fourth quarter of 2021.

Rate of increases in all major coverage areas decelerate

Insurance pricing in the first quarter of 2022 in the UK increased 20%, compared to 22% in the fourth quarter of 2021.

Constant bar chart represents Global Insurance Composite Pricing Change.

Property insurance pricing increased 9%, compared to 10% in the fourth quarter of 2021.

  • Significant pricing increases were largely imposed on clients with major loss activity or a challenging occupancy or business process, such as food production, warehousing, or waste recycling.
  • Insurers have moved from seeking to impose blanket price increases to targeting specific areas of the book they believe are underpriced or impacted by loss.
  • Insurers demonstrated a greater ambition to grow their books to take advantage of the current rating environment.

Casualty insurance pricing increased 3%, compared to a 4% increase in the prior quarter.

  • Employers’ liability pricing was similar to that of the prior quarter.
  • Electric vehicles (EV) impacted the auto insurance market significantly, with damage repair costs on electric vehicles running approximately 25% higher than cars with internal combustion engines; parts are hard to source and EV repair specialists in short supply.
  • Insurers continued to target rate uplifts in the casualty market, with the main driver being claims inflation; however, the level of uplift continues to be on a case-by-case basis.
  • Long-term agreements were more readily available, including three-year options, which were previously difficult to secure.
  • Sanctions, cyber, and non-standard coverages continued to be challenging; providing additional underwriting information remains vital to finalizing placement.

Financial and professional lines pricing, driven by cyber, increased 39%, continuing the decline from the 43% rise in the fourth quarter of 2021.

  • The rate of increase for D&O was 16% in the first quarter, compared to 24% in the fourth quarter of 2021, demonstrating a degree of moderation.
  • Clients impacted by increased risks during the pandemic saw sizeable reductions, though some small- to mid-size enterprises still experienced increases.
  • Some financial Institution clients experienced flat rates, and in some cases, small rate reductions.
  • Cyber insurance pricing increased by 102%, again driven by ransomware claims; with continued market deterioration and reduction in capacity, many clients turned to self-insured retention, as well as co-insurance.
  • Commercial crime coverage pricing increased 25% to 30%.