Cyber rates continue to rise, with rates doubling in some geographies
New York | February, 02, 2022
Global commercial insurance prices increased 13% in the fourth quarter of 2021, according to the Global Insurance Market Index released today by Marsh, the world’s leading insurance broker and risk advisor, continuing a trend of moderating rate increases that began in Q1 2021. While this is the 17th consecutive quarter of increases, the rate of increase continues to moderate in many lines of business and in most geographies.
Pricing increases across most regions moderated due to a slower rate of increase in property insurance and directors and officers liability (D&O). The UK, with a composite pricing increase of 22% (down from 27% in Q3), the US, where prices increased 14% (steady from the previous quarter) and the Pacific region, with a 13% increase (down from 17% in Q3) continued to drive the global composite rate. The rate of increase in Asia was 4% (down from 6%) and 9% in Continental Europe (down from 10%). The one exception to the moderating trend was Latin America and the Caribbean where rates increased by 4% (up from 2% the previous quarter).
Among other findings, the survey noted:
- Global property insurance pricing was up 8% on average, down from a 9% increase in the third quarter of 2021; casualty pricing was up 5% on average, down from 6% in the previous two quarters.
- Pricing in financial and professional lines, driven by cyber, again had the highest rate of increase across the major insurance product categories, at 31%, compared to 32% in the previous quarter.
- Cyber insurance rates continued to rise driven largely by the continued increase in the frequency and severity of ransomware claims with many insurers seeking to tighten coverage terms and conditions. Prices increased 130% in the US (up from 96% in Q3), and 92% in the UK (up from 73%).
Commenting on the report, Lucy Clarke, President, Marsh Specialty and Marsh Global Placement, said: “We are operating in a challenging risk and insurance market and will continue to focus on developing solutions in classes such as cyber, which will continue to be difficult for both clients and insurers. More broadly, however, we expect continued moderation in rate increases through 2022, a trend which will be welcomed by our clients.”
About Marsh
Marsh is the world’s leading insurance broker and risk advisor. With over 45,000 colleagues operating in 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 nearly $20 billion, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment through four market-leading businesses: Marsh, Guy Carpenter, Mercer and Oliver Wyman. For more information, visit mmc.com, follow us on LinkedIn and Twitter or subscribe to BRINK.
