Global average commercial insurance prices increased 14% in the first quarter of 2020, according to the Global Insurance Market Index released by Marsh, the world’s leading insurance broker and risk adviser. The increase, the largest since the index was launched in 2012, comes despite the minimal impact of the COVID-19 global pandemic on pricing in the quarter.
Average price increases were driven principally by increases in property insurance rates and financial and professional lines. Among other findings, the survey noted:
· The first quarter of 2020 was the tenth consecutive quarter of average price increases.
· Globally, on average, pricing for property risks increased 15%; financial and professional lines rose nearly 26%; and casualty increased 5%.
· Composite pricing in the first quarter increased in all geographic regions for the sixth consecutive quarter.
· The US (14%), UK (21%), and Pacific (23%) regions all experienced double-digit pricing increases. Pricing increases in these regions were largely driven by increases in property, financial and professional lines, and directors and officers (D&O) rates in particular. In the US, for example, pricing in the D&O market was up 44%.
Commenting on the findings, Dean Klisura, President, Global Placement and Advisory Services at Marsh, said: “Pricing was trending higher in the first quarter, prior to any meaningful impact from losses associated with COVID-19. However, COVID-19 will likely have an impact on pricing for the balance of 2020.”