February 7, 2014 by Canadian Underwriter
Average pricing declines across the world, except in the United States, drove global insurance rates down at the end of last year, according to Marsh’s latest Global Insurance Market Quarterly Briefing.
In the fourth quarter of 2013, rates tracked by the company’s risk management global insurance index fell in the United Kingdom, continental Europe, and significantly in the Asia-Pacific and Latin America regions. The U.S., on the other hand, showed a rise in overall rates, according to Marsh.
There were lower rates for global property programs renewing in the last quarter, but by a smaller magnitude than in Q3, the briefing notes.
In Latin America, rate reductions on renewal typically were around 10%, driven by competition and available capacity, while in Asia-Pacific, property rate declines averaged 5%.
Casualty insurance also typically renewed at a slight decrease across the globe, led by falling rates in Asia-Pacific, continental Europe and Latin America, according to Marsh. Rates also fell for financial and professional liability in Asia-Pacific, the United Kingdom and continental Europe.
“Strong capital positions, plentiful capacity, and ample competition within the global insurance industry are leading to favorable conditions for clients, especially those with well-managed risks,” David Batchelor, president of Marsh’s international division commented in a press release.
“In the U.S., insurers are competing aggressively for profitable business and new entrants are helping to moderate any rate increases,” added Robert Bentley, president of Marsh’s U.S. and Canada division.
Other findings from the report include: