Global commercial insurance prices increased by 15% in the second quarter of this year amid growing cyber security threats, according to analysis by Marsh.
The company's latest Global Insurance Market Index shows that prices have now risen for the 15th consecutive quarter, although the rate of increase has slowed over the last nine months.
Global property insurance pricing was up 12% on average, down from the 15% increase in the first quarter 2021, while casualty pricing was up 6%, which was the same as during the previous three months.
Pricing in financial and professional lines again had the highest rate of increase across the major insurance product categories, at 34%, compared to 40% in the previous quarter.
Meanwhile, cyber insurance pricing diverged from the moderation trend due to increasingly frequent and severe ransomware claims, with US prices rising by 56%, compared to 35% in first quarter, and UK prices increasing 35%, up from 29%.
“Clients continue to face a challenging risk and insurance landscape as the global economy emerges from the pandemic,” said Lucy Clarke, president of Marsh Specialty and Global Placement.
“Although we expect continued pressure on pricing, especially in loss affected lines, we also expect the general trend of moderating price increases to continue through the rest of the year.”
The fall in the average rate of increase follows year-on-year average prices rises of 18% in the first quarter of 2021, and 22% in the fourth quarter of 2020.
Increases across all geographies moderated due to slower rate rises in property insurance – except in Europe – and financial and professional lines – except in Asia and Latin America and the Caribbean.
The findings come after Swiss Re recently forecast total global premium volumes to surpass $7trn (£5trn) for the first time ever by the end of 2022, aided by a strong economic bounce-back from the pandemic.
The reinsurance giant forecasts global growth to hit a historically high 5.8% this year, with insurance premium growth of 3.3% in 2021, and 3.9% in 2022.
“Whether it is private medical insurance or supply chain interruption for businesses, the pandemic experience has made people much more aware of the need for insurance protection,” said Irina Fan, head insurance market analysis at the Swiss Re Institute.
Image credit: iStock
Author: Chris Seekings