The global broker Marsh published earlier this month its commentary on renewal activity for worldwide insurance risks up to 30 March 2020 showing a continuing upward trend in rate increases.
The summary reads "Global commercial insurance prices rose 14% in the first quarter of 2020, the tenth consecutive quarter of price increases. Although the COVID-19 global pandemic had an insignificant impact on pricing in the first quarter, the reported increase was the largest year-over-year increase in the Marsh Global Insurance Market Index since its inception in 2012. We anticipate that COVID-19 will likely have an impact on pricing for the balance of 2020."
Summarising their report, their findings are as follows:
- Property insurance pricing increased by 15%;
- Casualty pricing increased by 5%;
- Financial and professional liability rose by 26%;
- Rate increases occurred worldwide particularly in the UK, US and Pacific areas (Aus, NZ).
The increases listed above are at a global level: some further extracted detail:
- Property rates in the US increased 21% in the first quarter, the highest level recorded since the survey began in 2012;
- The excess liability market drove much of the overall casualty pricing movement, with average prices up 11%. Many risks experienced significantly greater increases;
- Pricing in the D&O market was up 44%, with 95% of clients experiencing an increase;
- Cyber insurance pricing rose 6%, the largest increase since 2016;
- Overall insurance pricing in the first quarter of 2020 in the UK increased 21%;
- D&O pricing showed significant increases, with some large accounts experiencing hikes of 100%. Generally, midsize accounts saw smaller increases, but still had prices up 50% to 70%.
Their report is well worth reviewing for the graphs that illustrate some of the extracts above.
The increases reported in this report are before the impact of COVID on the insurance industry. We expect that the next quarter's report will show a further acceleration in rate increases as insurers push for rate increases as a result.
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