Insurance News
U.S. Witnesses the Highest Increment in Commercial Insurance Rates in a Recovering World Economy
Highlights:
- Global insurance pricing rose 6% on average during the second quarter of 2022, down compared with 7% increase in one quarter.
- Commercial prices increased 9% in the second quarter of 2022, down from 11%.
- The cost of cyber insurance continues to rise, but at a slower rate in the U.S., with rates jumping 79% from last quarter.
Global property insurance pricing rose 6% on average during the second quarter of 2022. This is down compared with a 7% increase the previous quarter, but premiums are still growing at their fastest rate.
The Global Insurance Market Index showed that commercial prices increased 9% in the second quarter of 2022, down from 11%. This moderation is a recent trend which began earlier this year when rates were increasing more than ever before.
There is moderation in pricing across most regions due to the slower rate of increase in commercial property insurance and directors & officers liability coverage.
In the U.S., the global commercial insurance rates increased by 10% (down from 12%), and in the Pacific region by 7%. Latin America and the Caribbean saw a 5% rise in the first quarter 2022. Asia saw a 3% increase while six countries across Europe experienced no change or even decrease over this time period—not too bad considering how much the insurance companies have been estimating.
Other noteworthy price hikes include:
- Casualty pricing went up 6% on average as the number of accidents has increased.
- The cost of cyber insurance continues to rise, but at a slower rate in the U.S., with rates jumping 79% from last quarter alone.
- The financial and professional lines saw a sharp increase in overall pricing, driven by cyber. But this was down from 26% last quarter.
- The U.S. insurance buyers with significant losses or exposure to secondary catastrophe perils such as wildfire, convection storm, and floods experienced above average increases during periods of disaster.
Commenting on the insurance market in general, Marsh Specialist and Global Placement president Lucy Clarke commented, “In a time of global business uncertainty, followed by the ongoing war in Ukraine and rising inflation, there have been tough trading conditions for many clients. Additionally, there’s been an impact to insured values because it leads to higher risk premiums when dealing with insurers all over again.”
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