Pricing continues to soften, with double-digit rate reductions on property cover in key markets including Australia, Aon says in a third-quarter report.

The broker’s Global Insurance Market Insights paper notes price falls of 11%-20% for property in Australia and 1%-10% in New Zealand, with abundant capacity.

“Pacific buyers continue to benefit from competitive market conditions,” Aon Australia head of product and platforms for commercial risk solutions Tracy Riddell said.

“Now is the time to strengthen risk transfer programs to improve future resilience.”

Conditions are soft across most lines except motor, where insurers are applying higher deductibles in response to claims and increased repair costs.

“There is competition for well-performing fleets, and placements with a good claims history and increased vehicle count can achieve superior terms,” the report notes.

It says spare parts inflation is stabilising but there are shortages of key components for some electric and hybrid vehicles. 

Workers’ compensation losses are increasing in Australia due to rising worker-to-worker claims, while a combination of regulatory changes and contingency fee litigation is driving a significant uptick in the frequency and severity of casualty/liability claims.  

Inflation is affecting the cost of defending directors and officers claims, eroding policy limits.

Conditions favour buyers of cyber cover despite more claims and concerns around ransomware tactics, supply chain risk and criminals using artificial intelligence.

Aon says the global market offers plenty of opportunity, and more clients are using parametric triggers, structured insurance and facultative reinsurance.

Find the report here.