Commercial renewal prices in Australia increased 2% in the April-June period, Marsh’s latest quarterly Global Insurance Market Index shows. 

The 2% rise follows a 7% increase in the prior quarter and marks the fifth straight quarter of single-digit price growth. 

Financial and professional lines – one of three main classes covered by the index – declined 8%, its first contraction in more than 17 quarters as directors’ and officers’ (D&O) pricing continued to weaken and cyber rate growth decelerated in the face of increased competition for business. 

The worst appears to be over for D&O as pricing continued to fall, declining 10% or more in the June quarter. 

Marsh says D&O competition remained strong for both primary and excess layers from both new and legacy insurers. 

Cyber is also moderating with rate rises slowing sharply to 8% from 25% in the prior quarter. Insurers are providing more options for clients as competition heats up but risk information remained important, particularly around an organisation’s ability to mitigate ransomware threats, says Marsh. 

Property and casualty, the two other commercial insurance classes, increased 5% and 7% respectively in the June quarter. 

The 5% property rate rise is slower than the 8% increase seen in the previous quarter but loss-impacted and cat-exposed clients are seeing the highest increases, says Marsh. 

“Cautious underwriting continued. However there were signs of insurers seeking to grow business.” 

In casualty insurers are focused on claims inflation resulting from litigation trends as well as materials cost inflation. 

At the same time the emergence of new capacity fostered more competition than has been seen over the last three years, says Marsh.