Marsh released report denoting the decline in global insurance prices
Marsh, a leading insurance broker, has released a new report concerning falling insurance prices throughout the world. The report shows that global insurance prices have fallen by 2.8% year-on-year in the third quarter, which is the sixth consecutive quarter in which price declines have been recorded. Notably, insurance prices in Latin American have fallen more than in any other part of the world. This ongoing trend will have some impact on the insurance industry as a whole.
Prices are falling more dramatically in Latin America than elsewhere
The report from Marsh shows that insurance prices in Latin America have dropped by 6.2% in the third quarter. By comparison, insurance prices in the United Kingdom have fallen by 4.4% and 0.1% in the United States. Property rates showed the greatest decline throughout the world, especially in Latin America. Despite the impact of various natural disasters, property insurance has become somewhat less expensive and a growing number of businesses and homeowners are purchasing this coverage.
Cyber insurance continues to be a concern for financial institutions
The report also makes note of recent, high-profile cyber attacks. Financial institutions throughout the world have been expressing their concerns regarding digital threats. The insurance industry may be somewhat unprepared to manage these threats, however, due to the fact that many insurers have not had to focus on the digital space for the large portion of their existence. Because the digital world is still so new for the insurance industry, there are very few insurers that actually offer cyber insurance protection.
Insurance industry remains stable despite low investment yields and falling rates
Though insurance prices are falling globally, the insurance industry remains quite stable. The financial capacity of the global insurance market has been on the rise for the past two years. The report notes that buyers are becoming more willing to access global capacity, which is good news for multinational insurance companies. The report also notes that investment yields for insurers have remained quite low, which has forced many insurers to focus on underwriting profits.