Pacific Pricing Q3 2021

Pacific Pricing: Rate of Increase Slows for Third Consecutive Quarter

Insurance pricing in the Pacific region increased 17%, continuing an upward trend that began in 2015, although it was the third consecutive quarter in which the rate of increase slowed.

Property insurance pricing increased 11%.

• Elements of competition returned to the market for risks seen as high quality and/or loss free.
• Difficulties remained for high hazard industries, risks in CAT zones, and clients with poor loss records.

Casualty insurance pricing rose 15%.

• The casualty market remained challenging from a pricing perspective, although with slightly less pressure in the third quarter than the two preceding ones.
• Insurers’ emphasis on reviewing policy wording continued.
• Large programs underwent substantial restructuring of layers as underwriters changed appetite for excess layers.

Financial and professional lines pricing rose 25%, a significant moderation from 48% in the first quarter, but marking 21 consecutive quarters of double-digit increases.

• The levelling out in pricing of D&O programs continued amid developing competition, particularly for excess layers, which resulted in improved pricing for some large clients.
• Professional indemnity premiums increased again and capacity tightened.
• Cyber premiums increased dramatically, in line with the global trend; capacity shrunk and many programs were unable to purchase historical limits.