Global Commercial Insurance Rates Fall for First Time in 7 Years

Global commercial insurance rates declined by 1 percent in the third quarter of 2024, marking the first quarterly decrease since 2017, according to Marsh's Global Insurance Market Index. Marsh highlighted increased competition in the global property market as the main driver of this downward trend.

Regionally, the largest rate decreases were observed in the Pacific, which saw a 6 percent drop, followed by the United Kingdom with a 5 percent decrease. Other regions, such as Asia and Canada, saw rates fall by 4 percent and 3 percent, respectively. In contrast, the United States—along with Latin America and the Caribbean (LAC) regions—experienced a 3 percent rise in rates, while Europe remained flat.

Key findings from the report include the following.

• Property insurance. Rates dropped 2 percent globally after being stable in the second quarter and increasing by 3 percent in the first quarter of 2024. Significant declines were seen in markets like the United States and the United Kingdom, but rates increased in Europe and LAC. Insureds with assets concentrated in catastrophe zones such as the Gulf of Mexico, the US Atlantic Coast, or California, as well as those that had recently experienced higher-than-average rate increases, generally saw above-average rate decreases. However, this was before the recent Gulf of Mexico hurricanes.
• Casualty insurance. Global rates rose by 6 percent, continuing a trend driven by concerns over large jury awards in US courts.
• Financial and professional lines. These rates fell by 7 percent globally, marking the ninth consecutive quarter of declines.
• Cyber insurance. Global rates decreased by 6 percent, continuing the same rate of decline observed in the previous 2 quarters, with all regions experiencing reductions. More non-cyber policies contained cyber exclusions, which led to an increased focus on ways to address potential coverage gaps for property damage or bodily injury caused by a cyber event.

Pat Donnelly, president of Marsh Specialty and Global Placement at Marsh, said, "For the first time in seven years, we saw a decline in the global composite rate, with three of the four major product lines experiencing a decrease. We are watching the markets closely for any impacts from the recent devastating storms during the North American hurricane season."