US cyber rates accelerate in Q2
Cyber rates rose 21.3% in the second quarter, compared to 19.7% in Q1
Property/casualty rates rise 5.9% in aggregate in the second quarter, while cyber rates soar 21%, according to MarketScout
US property/casualty rates stabilised in the second quarter of the year but cyber rates continued to accelerate, according to new analysis.
Composite rates increased 5.9% in the quarter, virtually matching the rate increases of the first quarter 2022, MarketScout reported.
Cyber rates saw the greatest increase, rising 21.3% in the second quarter, compared with a 19.7% hike in the previous quarter. Rates in this class have soared in recent months amid rising losses, with some cyber buyers seeing rates more than double.
In contrast, umbrella rates moderated slightly in the latest quarter, increasing 8.7% compared to 9.7% in the first quarter of the year, according to MarketScout.
Commercial motor (up 9%), directors’ and officers’ liability (up 8.3%) and commercial property (up 8.3%) also saw large increases in the second quarter.
Medium-sized accounts ($25,000 to $250,000 in premium) experienced the largest rate increases, rising 7% in the second quarter, MarketScout reported.
By industry classification, transportation is still being assessed with the highest rate increases at plus 8.7%.
MarketScout chief executive, Richard Kerr, said future pricing will be affected by natural catastrophe losses and inflation.
“Hurricane season is upon us and soon to be followed by wildfire season. If we have big events, the increase in property rates will come quickly,” he said.
“Inflation can create a need for rate increases, so we may see that impact over the next four quarters.”
Kerr added higher interest rates could lead to rate increases slowing. “It’s possible higher interest rates could provide insurers with additional investment income, which could moderate rate decreases, especially on long-tail business,” he said.