Marsh USA  

Press Releases


Global Property Insurance Rates Continued to Firm in First Quarter: Marsh
| Share

Global property insurance rates continued to firm in the first quarter of 2012, according to a report published today by Marsh. Despite the absence of major natural catastrophes during the first three months of the year, rates rose for both catastrophe-exposed and non-catastrophe exposed risks in most geographies.

The leading driver of change in the property market is the insured catastrophe losses experienced in 2011, according to Marsh’s Global Insurance Market Quarterly Briefing: First Quarter 2012. The effects of these losses are also being felt in key risk areas like contingent business interruption, where insurers globally are taking a more cautious approach and asking for detailed information before underwriting the risk. In addition, changes implemented in 2011 to the risk models used by insurers will likely add impetus for property rate increases in the first-half of 2012.

In the U.S., rates for catastrophe-exposed risks generally increased between 10 percent and 20 percent, while property accounts with no catastrophe exposure typically rose by up to 10 percent. Some risks experienced higher increases depending on account specifics, geography, and the amount of catastrophe cover required. In countries affected by losses, rates for catastrophe-exposed risks continued to increase at a higher rate than risks with no catastrophe exposures.

“The global commercial property insurance market is continuing to show signs of upwards rate trends, especially for catastrophe-exposed risks,” said Dean Klisura, U.S. Risk Practices Leader, Marsh. “In the U.S., the property market continues to be in a state of transition with insureds more likely to experience rate increases than those renewing with flat or modest rate decreases. We believe that this trend will continue in the short term, with the average rate of increase continuing to rise month over month.”

According to Marsh’s report, other major trends identified in the first quarter included:

  • An increased demand for trade credit insurance across all geographies due to continued unease over the creditworthiness of companies in the Eurozone. This trend was most notable in Asia, where demand for trade credit insurance increased by up to 60 percent in the quarter.

  • A deterioration in the underlying trends for U.S. workers’ compensation insurance as the frequency and severity of claims continues to grow.

  • A continuation of last year’s trend in China, where directors and officers insurance rates for companies with U.S. exposures typically saw significant increases. In the first quarter of 2012, rates rose on average between 20 percent to 50 percent.


 


Product and Industry Solutions

Media Contacts
Sally Roberts
303 952 9453
sally.roberts@marsh.com

Lee Ann Farwell
212 345 1125
leeann.farwell@marsh.com

About Marsh
Marsh is a global leader in insurance broking and risk management. We help clients succeed by defining, designing, and delivering innovative industry-specific solutions that help them effectively manage risk. We have approximately 27,000 colleagues working together to serve clients in more than 100 countries. Marsh is a wholly owned subsidiary of Marsh & McLennan Companies (NYSE: MMC), a global professional services firm offering clients advice and solutions in the areas of risk, strategy, and human capital. With more than 54,000 employees worldwide and approximately $12 billion in annual revenue, Marsh & McLennan Companies is also the parent company of Guy Carpenter, a global leader in providing risk and reinsurance intermediary services; Mercer, a global leader in talent, health, retirement, and investment consulting; and Oliver Wyman, a global leader in management consulting. Follow Marsh on Twitter @Marsh_Inc.