Australia’s commercial insurance market was the world leader for premium rises in the third quarter, according to global broker Marsh.

It says the composite price for renewals was up more than 13%, outstripping other regions featured in Marsh’s Global Insurance Market Index.

The rise is consistent with the preceding quarter and builds on steady increases since the start of last year, following a long period of decline.

John Donnelly, Marsh’s Sydney-based Global Placement and Specialties Leader Pacific and Placement Leader Asia, says further rises are expected as insurers look to recoup their losses.

“Our expectation is that in quarter four and beyond there will be an acceleration of rate increases,” he told insuranceNEWS.com.au.

He predicts rises across the board in commercial property, casualty and financial lines.

“This is all driven by the fact insurers have been losing money. The area not losing as much money – in fact earning moderate profits – has been casualty.

“That’s why you see the increases are not as much [there] as in financial lines and property. Insurers are focusing on the lines of business and the customers who have been costing them money.”

The price rises have moved the index – Marsh’s measure of commercial insurance premium change at renewal – to 1.4% from 1.2% in the preceding quarter.

“Pricing increases continue to be observed across all major product lines,” the broker says.

“Financial and professional liability pricing continues to increase at double-digit rates, on average.

“The largest pricing increases were observed on financial institutions’ directors’ and officers’ coverage following several large losses and the ongoing royal commission.

“Casualty pricing increased in the low to high single digits for all product lines, on average, although competition in the marketplace is starting to increase, which should serve to stabilise future movements.”

Worldwide, Marsh says average commercial insurance prices increased by about 1% in the third quarter, marking four consecutive quarters of gains.

Property increased more than 3%, in line with the preceding three quarters. Casualty declined nearly 2%, continuing a trend dating back to 2013. Financial lines continued to accelerate, up more than 3%.

Dean Klisura, Marsh’s New York-based President of Global Placement and Specialties, says the market continues to respond to several factors, “including recent catastrophe events and increased claim activity on certain non-property coverages.

“However, market capacity remains strong in most product areas and geographies, limiting overall price increases.”