Renewal rates remain competitive but decreases slow in the US and Asia
US renewal rates remain competitive on average across all major lines of business in the third quarter of 2016, but US financial and professional liability lines experienced the lowest rate of decline and property lines experiencing the greatest rate of decline, according to Marsh’s Global Insurance Market Index covering the third quarter of 2016.
Although the high demand for cyber coverage continued to drive increases in renewal rates, the rate of renewal change has moderated steadily since the second quarter of 2015, the report said. Despite this, the limits of liability offered for US cyber coverage increased from $12 million in Q1 2016 to $22 million in Q3 2016, and the take-up rates went from 13 percent in 2013 to 19 percent in 2015, highlighting both the consistent rise in the average organizational cost per cyber breach and the continued demand for insurance.
Looking at the rest of the world, the report said that insurance renewal rates worldwide remained competitive; however, composite rate decreases slowed in the US and Asia Pacific in the third quarter of 2016.
The report said that the UK’s decision to leave the European Union has yet to impact insurance pricing. The insurance market remained competitive across all major coverage lines in the UK with flat renewal rates on average in the third quarter of 2016.
Insurance market rates remained competitive across most major coverage lines in continental Europe. However, while European casualty renewal rates were generally flat in the third quarter of 2016, motor/auto renewal rates increased in Spain, Germany, and Turkey on average.
