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US Insurance Market Prices

The Global Insurance Market Index is our proprietary measure of global commercial insurance premium pricing change at renewal - providing insights on the US insurance market prices.

Q3 2023 - US composite insurance pricing change

Property insurance pricing rises for the 24th consecutive quarter. Insurance pricing in the third quarter of 2023 in the US increased by 4%, the same as in the prior two quarters. 

Q3 2023 - US property composite insurance pricing change

Property insurance pricing increased by 14%, compared to 19% in the prior quarter; it was the twenty-fourth consecutive quarter in which pricing rose.

  • Pricing increases were driven by the costs of reinsurance and capital, strong demand, limited new capacity from insurers, and continued losses.
  • A bifurcation of renewal results has continued in 2023; better results were typically experienced by insureds with best-in-class risks, limited natural catastrophe exposures, and stable incumbent capacity.
  • Higher pricing was generally experienced by risks that carriers viewed to be of average to poor quality, loss impacted, and/or with assets concentrated in catastrophe (CAT) zones, such as along the Gulf of Mexico, Atlantic coast, or in California.
  • Underwriters continued to focus on inflation and insurance to value.
  • Insurers generally maintained discipline around CAT deductibles and limitations of coverage for nonphysical damage, cyber, and communicable diseases.
  • Many clients increased retention of risk via increased deductibles or by adopting alternative risk transfer such as captives, parametric, or structured solutions.

Q3 2023 - US casualty composite insurance pricing change

Casualty insurance pricing increased 2%, compared to 3% in the prior quarter; excluding workers’ compensation, the increase was 3%.

  • The primary casualty market remained competitive, particularly for workers’ compensation, with insurers demonstrating a willingness to offer aggressive collateral terms and multiyear pricing commitments.
  • Auto liability pricing continued to increase, driven by loss frequency and severity.
  • Excess liability pricing rose by 4%, compared to 8% in the prior quarter as insurers continued to increase pricing for large auto fleet exposures while general liability pricing varied depending on exposures.
  • Sizable jury verdicts and awards continued to drive down capacity by layer and increase attachment requirements. Financial and professional lines pricing decreased 6% in the quarter, compared to a decline of 10% in the second quarter.
  • Pricing for directors and officers (D&O) liability insurance for publicly traded companies declined by 8%.
    • Rate decreases eased slightly, especially for programs that experienced large declines in the past renewal cycle.
    • Large pricing decreases continued for post-transaction renewals, specifically in years one and two following an IPO or de-SPAC (special purpose acquisition company).
    • There was strong competition from both new carriers and legacy markets on primary and excess layers.
    • Many insurers sought to move to low excess or primary layers on D&O programs.
    • Some insurers were willing to place more difficult coverage lines, such as property, in an effort to win layers on the D&O program

Q3 2023 - US financial and professional lines composite insurance pricing change

Financial and professional lines pricing decreased 6% in the quarter, compared to a decline of 10% in the second quarter.

  • Pricing for directors and officers (D&O) liability insurance for publicly traded companies declined by 8%.
    • Rate decreases eased slightly, especially for programs that experienced large declines in the past renewal cycle.
    • Large pricing decreases continued for post-transaction renewals, specifically in years one and two following an IPO or de-SPAC (special purpose acquisition company).
    • There was strong competition from both new carriers and legacy markets on primary and excess layers.
    • Many insurers sought to move to low excess or primary layers on D&O programs.
    • Some insurers were willing to place more difficult coverage lines, such as property, in an effort to win layers on the D&O program. 
  • Fiduciary coverage pricing generally remained flat, compared to a 5% increase in the prior quarter. 
    • Adverse judgements continued to strain the market; with few dismissals on Employee Retirement Income Security Act (ERISA) cases, insurers generally paid out more on defence costs. 
    • ERISA 401k plan excessive fee litigation continued to drive insurer losses. 
    • Insurers typically sought minimum retentions for larger plans of US$5 million to US$15 million. 
    • New entrants to the market generally quoted lower retentions; however, they are untested and may seek part of a D&O program in order to write fiduciary coverage.
    • Controls/401k plan risk management were key to obtaining coverage. 
  • Financial institutions pricing decreased 7%; errors and omissions (E&O) pricing increased 2%.

Cyber insurance pricing continued to decrease, declining 6% in the quarter, compared to a 4% decrease in the prior quarter. 

  • Excess layer pricing reductions continued to drive down total program pricing. 
  • New managing general agents (MGAs), marketing themselves as “insurtechs,” continued to enter the market. These entities are not insurers but are backed by capacity providers (insurers or reinsurers).
  • Ransomware claims continued to increase. 
    • Improvements in cybersecurity controls have led to a higher proportion of insureds not paying ransoms; however, they may still incur breach response expenses and business income losses to which cyber policies respond. 
  • Increased insurer competition led to clients generally being able to secure lower retentions without a premium increase. 
  • With increased claims reported in 2023 over 2022, and pricing typically stabilising, clients generally sought higher limits.

Regional analysis

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Global Insurance Market Index

Global pricing

24/10/2024

The Global Insurance Market Index is our proprietary measure of global commercial insurance rate change at renewal - providing insights on the world's major insurance markets.
Skyline of London over Tower Bridge on the Thames

Global Insurance Market Index

UK pricing

10/30/2023

Insurance pricing in the UK declined 1% in the quarter, compared to a 1% increase in the prior quarter.
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Global Insurance Market Index

Latin America and Caribbean pricing

10/30/2023

Insurance pricing in the third quarter in the Latin America and Caribbean (LAC) region increased 10%, compared to 8% in the prior quarter.
Panarama of the mountains, snow and blue glacial ice of the Smeerenburg glacier, Svalbard, and archipelago between mainland Norway and the North Pole. An inflatable boat is anchored in the foreground.

Global Insurance Market Index

Europe pricing

Insurance pricing in the third quarter in Europe increased 4%, compared to 5% in the prior quarter.
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Global Insurance Market Index

Pacific pricing

Insurance pricing in the Pacific region increased 1% in the third quarter, compared to 2% in the prior quarter.
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Global Insurance Market Index

Asia pricing

Insurance pricing in the third quarter in Asia was flat, the same as in the prior quarter.
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Canada pricing

Insurance pricing in Canada declined 1% in the third quarter, the first quarter showing a year-over-year decline since the third quarter of 2017.

Skyscrapers in Abu Dhabi, United Arab Emirates.

IMEA pricing

Pricing in the third quarter increased 3% in IMEA, where insurance rates for large and complex accounts are often driven or influenced by the reinsurance market.