The tough directors’ and officers’ (D&O) market shows no signs of easing as rates again posted double-digit rises in the September quarter, according to the latest price tracker from Marsh.

In many cases D&O pricing for public companies increased more than 100%, similar to the levels experienced in the previous quarter.

Insurers continue to pull back from taking on D&O business because of the high threat of class actions, Marsh says. Numerous edits were made to policy wordings as a way to mitigate pricing impacts. A number of clients also refused to accept the steep rates quoted by insurers.

“The third quarter has seen the continuation of the upward trend for D&O, which is now 13 consecutive quarters of double-digit increases,” a Marsh spokesman told insuranceNEWS.com.au. “What we have seen now is the continued upward trend of what we have warned about.

“Worryingly, we have seen the impact of these consecutive increases reverberate through to SMEs and the not-for-profit sector.”

Marsh’s latest Global Insurance Market Index says commercial rates in the Australia-dominated Pacific market rose a record 33% in the September quarter, eclipsing the previous mark of 31% set in the preceding quarter.

Globally prices surged 20% in the third quarter from a year earlier, the largest increase since the index was launched in 2012.

In the Pacific market, all three commercial lines recorded price increases, with the financial and professional liability line leading the way with a 49% rise, underpinned by the tough D&O market.

Property rates rose 31%, lifted in part by the business fallout from COVID-19, which added 3-5% to the increase.

For casualty, prices grew 11% with a noticeable increase reported across most products in the region and major insurers reduced capacity, particularly for accounts with North American exposures.