Global commercial insurance rates decreased by 1% in the third quarter of 2024, marking the first quarterly decline since the third quarter of 2017, according to the latest Global Insurance Market Index released by Marsh.
This decline follows a trend of moderating rates, driven primarily by increased competition among insurers in the global property market. According to Marsh, average rates fell by 6% in the Pacific region, 5% in the UK, 4% in Asia, 3% in Canada, and 2% in India, Middle East, and Africa (IMEA) region.
Meanwhile, rates increased by 3% in the US and in Latin America and the Caribbean (LAC), while rates remained flat in Europe.
The report also highlighted that global property insurance rates fell by 2% after remaining flat in the second quarter of 2024 and rising by 3% in the first quarter. Rate declines were seen in the US, UK, Canada, Asia, Pacific, and IMEA, while Europe and LAC saw increases.
Companies with assets concentrated in catastrophe-prone areas such as the Gulf of Mexico, the US Atlantic coast, or California, along with those that had previously faced significant rate increases, experienced above-average rate decreases. However, this was before the impact of recent Gulf hurricanes.
Casualty insurance rates rose by 6% globally, continuing a seven-quarter trend of 3% increases. This was mainly attributed to concerns over large jury awards in US courts, according to Marsh.
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Financial and professional lines saw a 7% decrease globally, marking the ninth consecutive quarter of declines, with rate decreases recorded across all regions.
Cyber insurance rates also fell by 6% globally, continuing the trend of the previous two quarters. Every region reported declines in cyber rates. Additionally, more non-cyber policies included cyber exclusions, leading to increased focus on addressing potential coverage gaps related to property damage or bodily injury caused by cyber events.
Pat Donnelly (pictured above), president of Marsh Specialty and global placement at Marsh, commented on the report, stating that for the first time in seven years, global composite rates saw a decline, with decreases in three of the four major product lines.
“We are watching the markets closely for any impacts from the recent devastating storms during the North American hurricane season, and continue to offer support to our clients and the broader communities affected by them,” he said.
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