Global Insurance Market Update

Asia Pricing Q3 2022

Insurance pricing in the third quarter of 2022 in Asia increased 2%, down from 3% in the prior two quarters

beautiful nanpu bridge at dusk,crosses huangpu river,shanghai,China

D&O pricing continues to moderate

Insurance pricing in the third quarter of 2022 in Asia increased 2%, down from 3% in the prior two quarters

Constant bar chart represents Global Insurance Composite Pricing Change.

Property insurance pricing rose 2%, the sixteenth consecutive quarter of increases, which peaked at 18% in the third quarter of 2020.

  • Clients with challenging claims experience or those requiring support from facultative markets continued to see above average rate increases.
  • Natural catastrophe capacity continued to drive pricing that was above the average.
  • Global inflation remained a concern for insurers, with continued focus on the appropriate declaration of declared values.
  • The political violence (PV) market showed signs of contraction, with insurers carefully reviewing their aggregate exposures and pricing adequacy.

Casualty insurance pricing was flat for the second consecutive quarter.

  • Renewal results favored clients with exemplary claims performance and strong risk management practices.
  • Insurers continued to be selective in deploying capacity on challenged industry segments, including product recall and product liability exposure in North America.
  • Auto and workers’ compensation renewals experienced decreasing rates in a number of territories, while holding stable in others.
  • Insurers placed more focus on reviewing and updating policy wordings, ensuring the application of updated sanctions clauses and exclusions associated with PFAS, cyber, terrorism, punitive damages, and contractual liability.
  • Insurers took a stronger position on their ESG requirements, with some reducing or withdrawing their support based on the strength of the client’s commitment and practices.

Financial and professional lines pricing increased 5%, down from 13% in the prior quarter.

  • The pace of rate increases for D&O continued to moderate, with pricing in the range of 5% to 10% across Asia.
    • Increases were typically higher for US listed/ exposed business.
  • Pricing began to moderate for FIs; for large/complex accounts pricing was nearly flat.
  • Professional indemnity (PI) insurers were keen to explore smaller organizations, with customized offerings at competitive rates.
    • Some large and/or complex PI programs, especially from the communications, media and technology (CMT) sector, experienced average rate increases ranging from 5% to 10%, due to blended program structures with cyber coverages.
  • Insurers demonstrated caution regarding digital-asset related companies due to systemic risks resulting in volatility in asset pricing that can lead to sharp decreases in value, and potential liquidations.

Cyber insurance remained challenging, with rate increases of 25% or more experienced by some clients.

  • Concerns continued regarding claims, systemic risk, geopolitical tensions, and ransomware.
  • As in other regions, there were signs in the quarter that the cyber insurance market is stabilizing.

Global Insurance Market Index – 2022 Q3