Global: Commercial insurance rates decline 2% for second consecutive quarter
Source: Middle East Insurance Review | Mar 2025
According to the ‘Global Insurance Market Index’ released last month by Marsh, global commercial insurance rates fell 2% in the fourth quarter of 2024 following a 1% decline in the third quarter of 2024 – and marking the second consecutive quarterly decrease following seven years of rising rates.
The result continues the moderating rate trend first seen in the index in the first quarter of 2021, driven by intensified competition in commercial property insurance, a moderation of casualty rate increases, stabilising pricing in financial lines and accelerated rate reductions for cyber risks.
By region, Pacific (-8%), UK (-5%), Asia (-3%), Europe (-2%), and Canada (-2%) all experienced year-over-year composite rate decreases in the fourth quarter, while Latin America and the Caribbean (LAC) and India, Middle East and Africa (IMEA) experienced increases of 1%. Rates in the US were flat, following a 3% increase in 3Q2024.
Other findings included:
- Property rates declined 3% globally, following a 2% decline in 3Q2024. The Pacific region experienced the largest decrease, at 8%; the US and UK declined 4%; while Canada, LAC and Asia recorded low single-digit decreases. Property rates were flat in Europe and IMEA experienced a 3% increase in the fourth quarter. The global property market remains sensitive to loss events, particularly the ongoing Los Angeles wildfires, which will likely impact aggregate catastrophe losses in 2025.
- Casualty rates increased 4% globally, following a 6% rise in the previous quarter. US casualty rates continued to increase more than in other regions (7%). LAC recorded a 5% increase while the other regions ranged from 2% declines to 1% increases.
- Financial and professional lines rates decreased by 6% globally – the tenth consecutive quarter of declines – with rate decreases recorded in every region due to robust competition and available capacity.
- Cyber insurance rates decreased 7% globally – following a 6% decline in the previous quarter – with decreases in every region driven by strong competition among both incumbent and new insurers as well as continued improvements in cyber security at many companies.
Commenting on the report, Marsh global head of placement John Donnelly said, “The softening of rates across property, financial lines and cyber are a positive development for clients, while the challenges in other areas of the market, particularly in US casualty, are acute. We are committed to helping clients manage costs, protect their balance sheets and successfully navigate the evolving market conditions.” M