Global commercial insurance pricing increased for the eleventh consecutive quarter in the second quarter of 2020, according to Marsh’s quarterly Global Insurance Market Index, a proprietary measure of global commercial insurance premium pricing change at renewal, representing the world’s major insurance markets and comprising nearly 90% of Marsh’s premium. The increase, the largest since the index was launched in 2012, follows year-over-year average increases of 14% in the first quarter and 11% in the fourth quarter of 2019.
As with the first quarter, average price increases were driven principally by increases in property insurance rates and financial and professional lines.
Global property insurance was up 19% and global financial and professional lines were up 37%, while global casualty pricing was up 7% on average.
Composite pricing in the second quarter increased in all geographic regions for the seventh consecutive quarter.
The US (18%), UK (31%), Continental Europe (15%), and Pacific (31%) regions all had double-digit pricing increases. Pricing increases in these regions were largely driven by increases in property and directors and officers (D&O) coverages.
US public company D&O prices were up 59% on average, with more than 90% of clients experiencing an increase. In the UK, D&O pricing increases averaged over 100%. A similar situation exists in Australia, where a lack of competition has resulted in capacity shortage.