[Skip to content]

Sign up for our daily newsletter
The Actuary The magazine of the Institute & Faculty of Actuaries

Global insurance prices rise at fastest pace in seven years

Commercial insurance prices increased more in the first three months of this year than in any quarter since 2012, research from insurance broker Marsh has found.

Commercial insurance prices continue growing ©iStock

The Global Insurance Market Index shows that average commercial insurance prices rose by 3% between January and March, marking the sixth consecutive quarter of increases.

And composite pricing grew in all regions for the second quarter running, which Marsh said was driven by rate changes in property and directors and officers (D&O) insurance.

The Pacific region recorded the largest price rise of over 10% – a tend that has continued for eight quarters – while the UK and continental Europe saw average increases of 2% or higher.

“While 3% is the largest average increase in insurance pricing we have seen since the index began in 2012, market capacity remains strong in most products and geographies,” Marsh Global Placement president, Dean Klisura commented.

The research also found that pricing for property risks increased by almost 5% on average globally, slightly above the rates recorded in the previous four quarters.

Casualty prices declined nearly 1% on average, continuing a trend started in 2013.

And average pricing in financial and professional lines increased by almost 6%. All regions experienced a rise, which was largely driven by increases in D&O insurance.

This comes after research from finance company Premium Credit found that a growing number of UK businesses are ending their insurance coverage because they can’t afford it.

The findings show that 33% of small and medium-sized firms have cancelled a policy over the last three years because of price, with 50% of these happening in the last 12 months.

“It is shocking to see so many missing out on vital, sometimes legally necessary cover due to cost or concerns over payments,” Premium Credit director, Adam Morghem, said.

“This is leaving millions exposed to unnecessary risks and potentially even greater costs further down the line.” 

Sign up to our free newsletter here and receive a weekly roundup of news concerning the actuarial profession