Australia commercial pricing conditions continue to turn in favour of buyers as insurers put in more capacity to write more business, according to Marsh’s quarterly Global Insurance Market Index.

Rates inched up 1% in the third quarter following a 2% rise in the preceding quarter. The pace of increases has gradually slowed since the fourth quarter of 2020 when prices accelerated a record 35%.

Globally prices went up 3%, similar to the increase seen in the second quarter.

“I think we’re heading into 2024 with optimism… we’re probably at the end of the phase of the hardening [cycle],” Marsh Deputy Head of Global Placement Pacific Scott Eccleston says of the Australia market.

He told insuranceNEWS.com.au “the conditions for buyers are definitely improving”.

“There’s been introduction of new capacity across most classes of insurance and new capacity leads to more competition and better pricing for buyers,” Mr Eccleston said.

“I think it’s a pleasing trend for buyers that their cost is coming down.”

Director’s and officers’ prices remained on the downward trend with many clients experiencing declines of 15% or more in the quarter, adding to the pressure in financial and professional (Finpro) lines pricing.

Finpro decreased 5% after contracting 8% in the second quarter. Within the Finpro line, cyber pricing went up 6% but Marsh says the pace of increase is slower than the 8% rise seen in the second quarter.

Property rates moderated in the third quarter, rising 2% compared with 5% in the preceding period and there were some positive signs as competition returned with the introduction of capacity.

However, loss-impacted and catastrophe-exposed risks are still seeing the highest increases, says Marsh.

“Underwriters remained cautious, making it essential at renewals that declared values be supported by formal valuations and/or adequate inflation loadings.”

Marsh says in New Zealand the emergence of flood risk, primarily during the first quarter, has led to greater scrutiny by underwriters of coverage, pricing, and insurers’ own loss modelling.

In casualty Australia pricing rose 5% after accelerating 7% in the second quarter. Marsh says new capacity in the market fostered increased competition.