Asia commercial insurance pricing increases sluggish in Q2
Pricing increased just 3% for the region, the same as last year.
Price increases for Asia’s commercial industry have slowed down for the seventh consecutive quarter, growing only by 3% in Q2 2022, according to the Global Insurance Market report by Marsh.
The report revealed that the pricing increase in Q2 just mirrored the increase last quarter. Pricing peaked in Q3 2020 and increases have since started to lower from there.
Going by segment, property insurance pricing rates rose by 2%, the fifteenth consecutive quarterly increase. Marsh said pricing increases were most acute for clients with poor loss histories. The increase in property insurance was mostly because of natural catastrophe exposures, which makes pricing increases continue to be above average.
Casualty insurance pricing, meanwhile, flattened, following increases of 2% from the last two quarters.
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“Insureds with good loss histories generally experienced flat pricing, whilst those with poor loss histories experienced increases. Insurer risk selection in challenged industries contributed to reduced capacity and increased pricing. Additionally, insurers frequently restricted capacity on excess layers; challenges are more pronounced for product recall and product liability exposures,” Marsh said.
The biggest increase in Asia’s commercial insurance industry was with the financial and professional lines insurance, which saw pricing grow by 13% in Q2, the same as the previous quarter.
Directors and Officers Liability (D&O) insurance ranged from 10% to 15%, with capacity challenges for US-listed or exposed insureds for certain sectors and countries. Pricing for financial lines (FI) insurance moderated as insurers continues to manage capacity and retention levels.
The cyber insurance market meanwhile remained challenging with pricing increases ranging from 25% to 50% due to an increase in cyberattacks, claims, rising geopolitical tensions, and overall global market conditions.
Globally, commercial insurance saw prices increased by 9% in Q2. The peak increase was last recorded in Q4 2020 at 22%.