Despite pricing levelling out in certain lines of business, the insurance industry needs to be ready as the ‘pressure on rates in cyber insurance’ continues, says broker president
Global commercial insurance prices climbed 15% in the third quarter of 2021, according to the Global Insurance Market Index released by broker Marsh today (26 October 2021).
Despite the report noting that this is the 16th consecutive quarter of price increases, it also suggested that most pricing spikes peaked in quarter four of 2020 (22%).
According to Marsh’s findings, most regions saw a slower rate of growth in property insurance and directors’ and officers’ liability (D&O) cover during quarter three this year – the UK’s composite rate slowed down to 27%, dropping from 28% in Q2 2021.
Global property insurance pricing was up 9% on average in 2021’s Q3, down from a 12% increase in the first quarter of 2021. Casualty pricing globally was also up 6%, tracking the same as the previous two quarters.
Meanwhile pricing in financial and professional lines has maintained an upward trajectory, recording the highest rate of increase in Q3 2021 across the major insurance product categories at 32%, compared to 34% in the previous quarter.
Despite this, cyber insurance pricing continued to diverge from the third quarter’s moderation trend. Driven by the frequency and severity of ransomware claims, pricing in the UK increased by 73% - up from 35% in Q2 2021.
Marsh Specialty and Marsh Global Placement president Lucy Clarke said: “While the risk and insurance landscape remains challenging around the world, we expect rates to continue to moderate in most lines.
”However, the pressure on rates in cyber insurance is likely to continue. Developing solutions for our clients in this segment remains a top priority for Marsh.”