Insurance Rates Decline Across All Major Lines in Pacific Region
Insurance rates in the Pacific region continued their downward trend in the first quarter of 2025, according to Marsh’s Global Insurance Market Index. The decline was observed across all major insurance lines, including property, casualty, financial and professional lines, and cyber insurance.
Property Insurance
Property insurance rates in the region declined by 9% in the first quarter, marking the fourth consecutive quarter of negative growth. The increasing competition in this segment has led property insurers to actively pursue new business and offer increased capacity on existing policies. Incumbent underwriters primarily competed on price, with minimal changes to retentions, limits, and coverages. Clients with larger limits were encouraged to request alternative retentions, limits, and programme structures, fostering greater competition for lead terms. Some clients accepted long-term agreements (LTAs) to secure certainty on future rate movements.
Casualty Insurance
Casualty insurance rates in the region dropped by 2% in the first quarter, continuing the decline seen in the previous quarter. Insurers competed on price, terms, and conditions as the market became increasingly competitive. Larger accounts typically experienced significant improvements in terms. The approach to underwriting polyfluoroalkyl substances exposures varied across territories and occupations. The challenging conditions in the US casualty market were reflected in Australian placements involving US-domiciled risks.
Financial and Professional Lines
Rates for financial and professional lines of business in the region decreased by 10% in the first quarter, with rate decreases continuing across most classes, albeit at a moderating pace compared to the previous quarter. Rates for large D&O liability programmes have moderated from peak levels, allowing for retention adjustments. Strong primary alternatives were generally available for large D&O programmes, and LTAs were commonly offered.
Cyber Insurance
Cyber insurance rates in the Pacific region decreased by 8% in the first quarter, despite an increase in cyber incidents and claims notifications driven by ransomware, extortion, and fraudulent funds transfers. Insurers enhanced pre-loss offerings, providing various risk management services to policyholders in Australia and London. LTAs continued to be offered, with broad coverage remaining available.
The overall decline in insurance rates across the Pacific region reflects a highly competitive market landscape. Insurers are actively pursuing new business and broadening their coverage options, leading to more favorable terms for clients.
