Global commercial insurance prices increased 4% in Q4 of 2022, down from a 6% increase in Q3 and a 9% increase in Q2, according to Marsh’s Global Insurance Market Index.
Marsh’s Index explains that this continues a trend of moderating increases that first began in Q1 of 2021.
It adds that while this is the 21st consecutive quarter of increases, pricing increases moderated in most regions.
The exception was in financial and professional lines, which decreased for only the second time since Q3 of 2017.
Marsh’s Index finds that pricing increases across most regions moderated or remained the same due to an overall decrease in certain financial and professional lines.
In the US, composite pricing increased by 3%, down from 5% in Q3 of 2022, while rates in the UK were up by 4%, down from a 7% increase in Q3.
Meanwhile, rates increased in the Pacific by 5%, in Asia by 2%, and in Continental Europe by 6%, all of which were the same as the previous quarter.
In Latin America and the Caribbean prices rose by 7%, a rise on the 5% increase recorded in Q3.
Lucy Clarke, President of Marsh Specialty and Global Placement, commented, “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.
“Pricing for property risks continues to be impacted by the high level of losses in 2022, especially resulting from Hurricane Ian.
“We are working with our clients to examine a wide range of options, including the increased use of captives and alternative risk financing options, to address their needs and to obtain the optimal outcome for them from the market.”
Marsh’s Global Insurance Market Index also found that Global property insurance pricing was up 7% on average in the fourth quarter of 2022, compared to a 6% increase in the previous quarter, while casualty pricing was up 3% on average, compared to 4% in Q3.
Further, cyber insurance pricing increased 28% in Q4 2022, compared to a 53% increase in Q3.
In the largest cyber insurance markets, the rate of increase continued to moderate significantly with prices rising by 28% in the US and 34% in the UK, compared to 48% and 66%, respectively, in the prior quarter.
Marsh notes that concerns about the impact of inflation on asset values and claims costs continued to be a focal point for insurers at renewal in most regions.
