Global Insurance Market Index – 2021 Q1
Global commercial insurance pricing up 18% in first quarter of 2021
Global commercial insurance prices increased 18% in the first quarter of 2021, according to the 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 quarter is the first to show a fall in the average rate of increase since the index reported the first rise in global rates in Q4 2017. It follows year-on-year average increases of 22% in the fourth quarter and 20% in the third quarter of 2020.
According to the index, increases across geographies moderated due to generally slower rate rises in property insurance and financial and professional lines. The UK, with a composite pricing increase of 35% (down from 44% in Q4 2020) and the Pacific region, with a 29% increase (down from 35% in Q4 2020) drove the global composite rate. The rate of increase in the US was 14% (down from 17%), in Pacific 29% (down from 35%), in Asia 8% (down from 11%), and in Latin America and the Caribbean 5% (down from 9%).
Among other findings, the survey noted:
- Global property insurance pricing was up 15% on average, down from the 20% increase in the fourth quarter 2020; casualty pricing was up 6% on average, compared to a 7% increase in the prior quarter.
- Pricing in financial and professional lines had the highest rate of increase across the major insurance product categories, at 40%, compared to 45% in the previous quarter.
- Cyber insurance pricing diverged from the trend, with prices increasing in the first quarter by 35% in the US and 29% in the UK, driven by a rise in the frequency and severity of losses. In the previous quarter, cyber rates were 17% in the US and 26% in the UK.