Australia’s composite insurance rate has risen by 13.6% on average according to the latest quarterly
Marsh Global Insurance Index.
Rate increases were observed in property, casualty and FinPro lines, the brokerage’s report notes, and Australia is the only geography within the report to see increases as the global market overall saw prices dip for the 18th consecutive quarter.
John Donnelly, head of placement for Asia-Pacific at Marsh, said it was no surprise to see further positive rate movement locally.
“Rate movements were largely predictable and in line with our expectations although some risks, such as those with EPS, recyclers and other high hazard industries, proved more challenging,” Donnelly told Insurance Business. “We expect that trend to continue in Q4.”
The report found increases of 17.5% in property, up from 7.5% in the last quarter, while FinPro lines saw increases of 12.5%, compared to 6.7% in the previous quarter. Casualty saw the smallest increases of 4.8%, compared with 2.7% previously.
“The
APRA statistics for casualty business are more positive than property so there is less emphasis on the need for price correction from insurers’ perspective,” Donnelly continued. “There is still strong competition in the primary casualty.”
The global composite insurance rate, which encompasses markets in the US, UK, Europe, Latin America and Asia, currently stands at -1.6% in comparison to Australia’s composite increase of 13.6%. However, the global rate of decline slowed for the seventh straight quarter as Donnelly noted the global market continues to head in the right direction.
“Premium rates globally are starting to lift, and the early results for Q4 from the USA composites index indicates the rate decline has reversed,” Donnelly continued. “It is early days for the major Q4 renewals but, unquestionably, the trend is north. The full market impact of the hurricanes and other disasters will not be known until after the 1/1 treaty renewal season.”
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