Global Commercial Insurance Rates Drop 3% During Q1, but US Casualty Bucks the Trend

Global commercial insurance rates fell 3%, on average, in the first quarter of 2025 following a 2% decline in Q4 2024, according to the Global Insurance Market Index published quarterly by insurance broker Marsh.

The Q1 2024 average commercial rate decline marked the third consecutive quarterly decrease reported by the index following seven years of rising rates, Marsh said.

Casualty lines bucked the trend of softening rates by increasing globally by 4%, level with Q4 2024, said Marsh, noting that US casualty rate hikes of 8% strongly contributed to the global average increase.

“Due largely to the severity of claims and large jury verdicts — sometimes called ‘nuclear verdicts’ — available capacity tightened, with underwriters continuing to reduce their line sizes. US casualty market conditions typically impact rates and coverage in other regions,” said John Donnelly, president, Global Placement, in a commentary introducing the index.

Conversely, Marsh attributed moderating rate trends in non-casualty lines to heightened competition among existing providers and some new entrants. This is particularly evident in property, financial and professional, and cyber lines, where insurers are actively seeking new business opportunities and expanding their offerings, Marsh said, noting that the index first started tracking moderating rates in Q1 2021.

All global regions experienced year-over-year composite rate decreases in Q1. Rates fell in Pacific by 8%, in the UK by 6%, in India, Middle East, and Africa (IMEA) by 4%, in Asia and Canada by 3%, in Latin America and the Caribbean (LAC) by 2% and in the US and Europe by 1%.

“We expect the overall trend to continue, and for insurer competition to intensify, barring unforeseen changes in conditions. We are committed to helping clients manage costs, protect their balance sheets, and successfully navigate and benefit from the continued improvement in market conditions,” Donnelly said in a statement accompanying the index.

Indeed, the report said that many insurance buyers used “the increasingly competitive environment to negotiate better terms, enhance coverage, and explore alternative risk transfer solutions such as self-insurance and captives.”

Other findings from the report included:

• Property rates declined 6% globally, following a 3% decline in Q4 2024. The US and Pacific regions experienced the largest decreases, at 9% each; the UK fell 6%; IMEA and LAC declined 4%; Canada by 3%, and Europe and Asia by 1%. The global property market is experiencing increased capacity driven by insurers’ improved financial performance and lower reinsurance costs.
• US casualty rates rose by 8% on average in the first quarter and capacity for US casualty remained constricted in Q1 2025. Other global regions either had low single digit increases or decreases.
• Financial and professional lines rates decreased by 6% globally, the same rate as the previous quarter, with rate decreases recorded in every region as a result of robust competition and available capacity.
• Cyber insurance rates decreased 6% globally – following a 7% decline in the previous quarter – with decreases in every region. Insureds are increasingly taking a proactive approach to risk management and are often using premium savings to enhance their coverage, reduce retentions, and increase limits.

* Note: All references to rate and rate movements in this report are averages, unless otherwise noted. For ease of reporting, Marsh has rounded all percentages regarding rate movements to the nearest whole number.

Related:

Topics
Trends
USA
Commercial Lines
Business Insurance
Casualty