Average global commercial insurance rates continue to decline, though Australia sees a boost
Average global commercial insurance rates have decreased for the 18th consecutive quarter, though the rate of decline slowed slightly compared to the previous quarter. Rates were not yet affected by the recent spate of natural catastrophes.
In the third quarter of 2017, rates were down 1.6%, compared to a fall of 2.2% in the previous quarter, according to Marsh’s Global Insurance Market Index. According to Marsh president of global placement and specialties Dean Klisura, this is “largely due to capacity in the marketplace and competitive underwriting. ”
Rate decreases did slow across property and financial and professional lines. Global property rates also declined, though this was by 1.7% compared to 2.8% in the quarter before.
Average rates decreased in the UK, but not as much as in the previous quarter. It was the same in Asia. A higher rate of average decrease happened in the US, the rest of Europe, and Latin America compared to the second quarter of 2017. Australia was the only area where rates increased. This is the third consecutive quarter where rates in Australia have seen a boost.
Klisura addedrates have not yet been impacted on by hurricanes Harvey, Irma and Maria, or the Mexico earthquakes.
Klisura said: “The third quarter of 2017 was the 18th consecutive quarter in which average rates declined globally, largely due to capacity in the marketplace and competitive underwriting. It is worth noting that property damage and business interruption losses from the recent natural disasters in the US and elsewhere had little to no impact on average rates in the quarter as they occurred late in the reporting period. Early indications are showing evidence of rate increases for US catastrophe-exposed property risks.”