Global commercial insurance costs rose 4% in Q4 2022 – Marsh

The average combined cost of commercial insurance rose 4% over the last quarter of 2022, continuing a trend of moderate increases that began in Q1 2021.

This is according to broker Marsh’s latest Global insurance market index, published today (2 February 2022).

A 4% rise in the latest reporting period represents the 21st consecutive quarter-on-quarter increase in average premiums, although Marsh’s research showed that the rate of increase moderated in most lines.

Premiums in certain financial and professional lines cover decreased rather than moderated, however – only the second decrease since Q3 2017.

Moderations in average price increases across most regions were the result of decreases in these specific financial and professional lines – with directors and officers (D&O) cover the most notable.

Marsh showed that composite pricing in the UK had increased by 4% across Q4 2022, which was down from a 7% increase in Q3.

Tough operating environment

Commenting on the report, Lucy Clarke, president of Marsh Specialty and Global Placement, said: “After a challenging 2022, our clients will continue to face a tough operating environment in 2023.

“With a slowdown in the global economy, in addition to ongoing inflation and geopolitical tensions, many clients face significant headwinds.”

According to Marsh’s report, pricing for cyber cover continued to experience volatility despite a slow down in the rate of premium increases.

While the average cost of cyber insurance increased by 28% across Q4 2022, this represented a slow down in rocketing premium costs – Q3 2022 saw an increase of 53%.

In the UK across Q4 2022, the average cost of cyber cover increased by a larger percentage than the global average, sitting at 34% – this was compared to a larger increase in Q3 2022 however, with this rise sitting at 66%.