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D&O, property leading premiums higher: Marsh

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Surging directors’ and officers’ rates and rising property premiums powered an 18.8% third-quarter jump in Pacific region pricing, while global insurance market gains also gathered pace, Marsh says.

Financial and professional liability pricing rose 27.5% in the Pacific region, where Australia is the largest market. Increases of 100% were “not uncommon” for listed company D&O entity cover, with prices being driven by securities claims.

“The claims environment has led to a number of insurers exiting the marketplace, with others taking firmer positions on price, capacity and retentions,” the report says.

“A large volume of Australian business is being placed into the London market, where similar firming is evident.”

In property insurance, many risks in Australia and New Zealand experienced price increases of 10-20%.

Gains across many industries, including real estate, mining and downstream energy, came amid reduced capacity and appetite from major insurers.

The overall Pacific composite insurance pricing increase follows an 18.3% jump in the second quarter and increases of 16.1% in the two previous quarters.

The region continues to lead international gains in the Marsh Global Insurance Market Index, which reflects renewal pricing. The data is gathered from the world’s major insurance markets and comprises nearly 90% of Marsh premium.

The report says that global insurance pricing increased 8% in the third quarter, the largest increase since the survey began in 2012 and up from 5.8% in the second quarter.

“Global pricing has now increased every quarter for nearly two years and market capacity is starting to show signs of tightening in certain geographies and lines of business,” Marsh President Global Placement Dean Klisura said.

US pricing increased 6.4%, accelerating from a gain of 4.8% in the second quarter while UK gains gathered pace to 11.8% from 6.3% driven by property and financial and professional liability.

The global trends were also reflected in Asia, where pricing increased 5% year-on-year, the largest composite increase for the region in five years.

Property catastrophe pricing in Singapore, Hong Kong and India increased by double digits.