Gallagher says commercial rates in the New Zealand market have softened, bringing relief for businesses after several years of rises.

Insurers are more willing to negotiate on premiums across many lines, particularly on material damage and business interruption covers, the broker says.

“This is great news for clients … in the past two or three years, [insurers] have often been inflexible. For risks with a good claims record, there are generally no longer premium increases coming at renewal in 2025.

“Of course, there will be exceptions to the rule but overall, the market is swinging in favour of the insurance buyer.”

On higher-value commercial risks, the London market is proving highly competitive as insurers look to diversify their portfolios to avoid being too US-centric.

“This in turn is creating competitive tension in the local insurance market, which is keen to retain market share and prevent capacity shifting offshore,” Gallagher says.

The global broker says the New Zealand market began to show signs of softening in the final quarter of last year as inflation pressure started to ease.

While losses from global climate-related events have not slowed, reinsurers and insurers have adapted to a new baseline of natural disaster planning for any given year.

Last year brought more major catastrophic insured events than the rolling 10-year average, according to the broker.

“However, the 2023 restructure of reinsurance arrangements and pricing increases meant the global insurance market could sustain these losses.

“This is great news for insurance buyers, as it demonstrates stability in both the global and local insurance markets.”

Gallagher says stability is further evidenced by the fact the Los Angeles fires have not resulted in a market change, despite causing about $US52-$US57 billion ($82-$90 billion) in insured losses.

The financial performances of IAG and Suncorp have also contributed to the softening market.

“The results of these companies are reflected in most global insurer and reinsurer performances. These strong performances attract more capital into the marketplace, which in turn drives increased competition.”