The 2025 Airmic Conference is approaching, and industry experts are discussing the recent decline in global commercial insurance rates. According to Marsh’s ‘Global Insurance Market Index,’ rates dropped by an average of 3% in Q1 2025, marking the third consecutive quarterly decline. This trend, which began in early 2021, reverses nearly seven years of rising rates.
Nina Arquint, newly appointed UK & Ireland CEO of Swiss Re Corporate Solutions, shared her insights with Insurance Business ahead of the conference. She noted that the UK market has seen a significant drop in rates across various lines, particularly in property and financial and professional lines. “We’re coming from a hard market environment, so it has overall been a solid market but one you can now see softening across different lines of business,” Arquint explained.
Factors Influencing Commercial Insurance Rates
Arquint emphasized that the current trend must be understood within the context of an increasingly complex and interconnected risk environment. Key factors influencing businesses today include climate and environmental risk, geopolitical instability, and the impact of technology on clients’ businesses. The latest Swiss Re sigma report projected that insured natural catastrophes are on track to reach $145 billion in 2025, driven primarily by secondary perils such as severe convective storms, floods, and wildfires.
“It is a very competitive market out there, and I think competition as such is not a bad thing, it keeps you on your toes and it keeps driving innovation,” Arquint said. “But it’s also really important, as an insurance industry, that we are very aware of the dynamic risk landscape we’re facing. And we should make sure that on the risk-adjusted basis, the rate environment stays healthy and resilient.”
Variance in Commercial Insurance Pricing Across Business Lines
Arquint examined the variance in commercial insurance rates across different business lines in the UK. While casualty rates remain competitive, particularly for non-US casualty business, financial and professional lines rates decreased by 6% globally, with a 10% decline in the UK. Property rates also declined by 6% in the UK over Q1 2025, consistent with the global decrease.
The Importance of Transparency in Insurance Pricing
Clients are questioning the fluctuation in rates, particularly on the property side, given the expected $145 billion in insured natural catastrophes in 2025. Arquint attributed this to competition and the need for transparency in pricing approaches. “Clients want to know how a premium comes together, and what factors are considered in setting a rate,” she said.
The industry is seeing increased demand for alternative risk transfer (ART) vehicles, such as captives, as clients seek more holistic approaches to risk management and financing. Arquint emphasized that this development is not solely in response to price fluctuations but rather the evolving conversation about risk management and risk transfer.
Future Outlook
Looking ahead, Arquint stressed the importance of her team delivering on the needs of multinational companies while staying vigilant on pricing and market conditions. Swiss Re Corporate Solutions plans to deepen its local market presence in the UK and Ireland, investing in data and technology capabilities to provide smarter risk insights and enhance decision-making for customers.
As for the future of commercial insurance pricing, Arquint noted that the rates are becoming increasingly volatile, and the global risk environment is interconnected. “When I look at the risk landscape and the pricing cycle, I don’t think we will see any significant deterioration in some of these lines of business, because it would, in my view, not be justified from that risk perspective. But we will see.”
