Globally, cyber insurance pricing decreased by 2% in Q3 of 2023, compared to a 1% increase in Q2, marking this as the first quarter to record an average decrease since the second half of 2018, according to insurance broker and risk advisor Marsh, a business of Marsh McLennan.
More broadly, Marsh’s Global Insurance Market Index found that global commercial insurance prices increased by 3% in Q3 of 2023, the same as the prior quarter. This marks the 24th consecutive quarter of pricing increases.
According to the firm, pricing continued to be relatively consistent across almost all regions in Q3.
This was reportedly driven by a continuation of the trend for rate decreases in financial and professional lines and the aforementioned small decrease in prices in the cyber insurance market. However, this was somewhat offset by property insurance increases, most notably in the US, where property prices rose on average by 14%.
Broken down, in the US, Q3 prices rose overall by 4% on average, the same as the previous two quarters. In Latin America and the Caribbean, pricing increased by 10% (up from 8% in Q2). Meanwhile, in Europe, prices increased by 4% (down from 5% in Q2). In the Pacific, prices increased by 1% (down from 2%) and were flat in Asia.
In the UK, composite pricing decreased by 1% (compared to a 1% increase in Q2). In Canada, prices in Q3 decreased by 1%, and India, Middle East & Africa recorded an increase of 3%.
As for some of Marsh’s other findings, global property insurance pricing was up 7%, on average, in Q3 of 2023, a fall from an increase of 10% in the previous quarter. Casualty insurance pricing increased 3%, the same as the previous three quarters.
The Index also observed that for the fifth consecutive quarter, overall average pricing for financial and professional lines fell. Driven by rate reductions and additional capacity – particularly in the UK – average pricing decreased by 6% in Q3, compared to a decline of 8% in Q2.
Commenting on the report, Pat Donnelly, President, Marsh Specialty and Global Placement, Marsh, said, “After years of increases, even a modest reduction in cyber rates will be welcomed by clients and in large part is recognition of the hard work they have done to improve their cyber resilience.
“However, the property market – and property catastrophe in particular – remains challenging and is an area of focus of our work with clients.
“In an uncertain geopolitical and economic environment, we are exploring a wide range of risk mitigation options with clients that can help them to manage the broad range of risks they face, build greater organizational resilience, and gain positive outcomes from insurers at renewal.”
