Overall commercial rates in the Australia-dominated Pacific market again grew at a slower pace in the third quarter but the cyber line bucked the trend, mirroring patterns seen globally, according to the latest Marsh price index.

Pacific pricing went up 17% in the third quarter of this year, less than the 23% rise in the second quarter and 29% increase in the first. In the December quarter last year, prices rose 35%.

The broker says cyber pricing conditions in the Pacific market and globally “continue to diverge from the moderation trend” as insurers face increases in frequency and severity of claims, especially in relation to ransomware.

“Cyber premiums increased dramatically, in line with the global trend,” Marsh said. “Capacity shrunk and many programs were unable to purchase historical limits.”

Pacific rates for financial and professional lines went up 25% during the period, moderating sharply from 37% and 48% in the second and first quarters.

While the 25% rise represents 21 straight quarters of double-digit hikes, Marsh says the directors’ and officers’ (D&O) product class is seeing a “levelling out” in pricing.

The broker says this comes amid developing competition, particularly for excess layers. This has led to improved pricing for some large clients.

Pacific property rates rose 11% in the September quarter, down from 14% in the preceding period and casualty went up 15%, compared with 18% in the June quarter.

Globally commercial rates grew 15%, similar to the June quarter but the pace of increase continues to moderate in many lines of business and in most geographies.

“This trend may suggest that pricing increases peaked in the fourth quarter of 2020, at 22%,” Marsh said.

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