Global Commercial Insurance Pricing Increased 20% in Third Quarter
Global commercial insurance pricing increased 20% in the third quarter of 2020, according to Marsh's quarterly Global Insurance Market Index, a proprietary measure of global commercial insurance premium pricing change at renewal, representing the world's major insurance markets and comprising nearly 90% of Marsh's premium. The increase, the largest since the index was launched in 2012, follows year-over-year average increases of 19% in the second quarter and 14% in the first quarter.
The average composite price increase of 20% was driven principally by property insurance rates and financial and professional lines. Among other findings, the survey noted:
- Global property insurance pricing was up 21% and global financial and professional lines were up 40% on average, both greater than the increases reported for the second quarter. Casualty pricing was up 6% on average, a slight drop from the 7% increase reported for the prior quarter.
- ·Composite pricing in the third quarter increased in all geographic regions for the eighth consecutive quarter.
- All regions, except Latin America (9%), reported double-digit pricing increases, led by the UK (34%), Pacific (33%), and the US (18%). Pricing changes in all regions were equal to, or greater, than increases reported for the second quarter.
- Public company directors and officers (D&O) coverages continued to see large increases. D&O pricing in the UK and Australia was up more than 100%, while pricing in the US was up nearly 60%. More than 90% of US public company D&O clients experienced an increase.
- Overall insurance pricing in the third quarter of 2020 in the Pacific region increased 33%, continuing an upward trend that began in 2015.
- Property insurance pricing increased 31%, the twelfth consecutive quarter of year-over-year double-digit increases.
- Financial and professional liability pricing rose 49%, marking 13 consecutive quarters of double-digit increases.
- Casualty pricing rose 11%.