Today Marsh released its Global Insurance Market Index for the fourth quarter of 2020. The increase, the largest since the index was launched in 2012, follows year-on-year average increases of 20% in the third quarter and 19% in the second quarter of 2020.
Although the global index increased 22%, the index shows that price increases may be starting to plateau for some lines of insurance in certain geographies. For example, property insurance and directors and officers (D&O) insurance pricing in the US shows signs of moderating increases, and similar trends can be seen in certain property and casualty lines in Continental Europe and Latin America and Caribbean (LAC). Regionally, Continental Europe, Asia, and LAC have now experienced moderate levels of price increases for three quarters.
The average composite price increase in the fourth quarter was driven principally by property insurance rates and financial and professional lines. Among other findings, the survey noted:
Commenting on the report, Lucy Clarke, President, Marsh JLT Specialty and Marsh Global Placement, said: “The global insurance marketplace was very challenging in 2020, and we expect these conditions to persist through the first half of 2021. Although we are seeing signs that price increases are beginning to plateau in some lines, our clients continue to face tough trading conditions. We are committed to presenting all risk mitigation and insurance placement options to our clients and to offer advice and support as they consider adjusting their insurance buying patterns.”
Marsh is the world’s leading insurance broker and risk advisor. With around 40,000 colleagues operating in more than 130 countries, Marsh serves commercial and individual clients with data-driven risk solutions and advisory services. Marsh is a business of Marsh McLennan (NYSE: MMC), the world’s leading professional services firm in the areas of risk, strategy and people. With annual revenue over $17 billion, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment through four market-leading businesses: Marsh, Guy Carpenter, Mercer and Oliver Wyman. Follow Marsh on Twitter @MarshGlobal; LinkedIn; Facebook; and YouTube, or subscribe to BRINK.