Focusing on lines of business, global property insurance pricing jumped by 8% on average in Q4 2021, down from a 9% increase in the third quarter of the year (Q3 2021). Meanwhile, casualty pricing increased by 5% on average, down from 6% in the previous two quarters
Insurance pricing in financial and professional lines soared during the same period, with cyber having the highest rate of increase among the major insurance product categories at 31% compared to 32% in the previous quarter.
During the same quarter, cyber insurance rates rose by 130% in the US (up from 96% in Q3 2021) and 92% in the UK (up from 73% in Q3 2021), driven mainly by the continued increase in the frequency and severity of ransomware claims, with many insurers seeking to tighten coverage terms and conditions.
Focusing on geography, the index indicated that the UK saw a composite pricing increase of 22% in Q4 2021 (down from 27% in Q3), the US saw a 14% increase (steady from the previous quarter), and the Pacific region had a 13% increase (down from 17% in Q3) – all driving the global composite rate. In Asia, the increase rate was 4% (down from 6%), and Continental Europe was 9% (down from 10%).
The only exception to the moderating trend was Latin America and the Caribbean, where rates increased by 4% (up from 2% the previous quarter).
As Marsh still operates in a challenging risk and insurance market, Lucy Clarke, president, Marsh Specialty and Marsh Global Placement, said the company will develop solutions in classes such as cyber because it is expected to remain challenging for clients and insurers.
“More broadly, however, we expect continued moderation in rate increases through 2022, a trend which will be welcomed by our clients,” Clarke said.