Rate gains easing, but still delivering shocks to clients: Marsh
Insurance rates may be slowly decelerating on the whole, but with pockets of pain remaining for clients in select lines, officials at global brokerage Marsh McLennan have said.
“Rate increases in the marketplace continue to persist, reflecting losses and concerns on inflation,” chief operating officer John Doyle (pictured) told the Q1 investor call. “The insurance and reinsurance markets remain pretty challenging for our clients.”
The 18th consecutive quarter of rising rates may have left clients “weary”, but two consecutive quarters have at least brought deceleration, Martin South, CEO of unit Marsh, told the conference. Two points have come off of the growth rate in each of the past two quarters to render an 11% aggregate rate increase in the latest Marsh McLennan reading.
South cited a “still strong” 4% growth rate in casualty and a 7% growth rate in property. Professional lines excluding cyber are rising at a double-digit pace of their own before getting hit by the doubling of cyber rates. Mark cyber rate gains at over 110% in the US and UK.
“There’s a lot of concern over that, otherwise the market is in deceleration,” South said.
Reinsurance rates are retelling a story first laid out at the January renewals, officials indicated. “April 1 renewals largely reflected a continuation of January,” Doyle told call participants. “Finding capacity is challenging in specific segments.”
Amongst elements, property cat continues to have problems with aggregate capacity, parts of cyber reinsurance coverage are tight and some London specialty segments have been “really impacted” by the war in Ukraine.
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