According to insurance broker Marsh, global property insurance rates fell by 3% in the fourth quarter of 2024, following a 2% fall in Q3, with the Pacific region experiencing the largest decrease, at 8%, while both the US and UK declined 4%.The analysis from the insurance broker shows that during the final quarter of last year, property insurance rates fell by 3% globally, with rates in the United States falling by 4%, compared to a decline of 1% in the prior quarter.Commenting on US property insurance rates, Marsh said, “Increased insurer capacity and competition were driven by strong financial performance in the property sector over the past three years, along with cost reductions and stable reinsurance structures.” The broker also noted that US insurers began to show greater underwriting flexibility during Q4, and considered movements favourable to insureds on sub-limits, coverage definitions, and natural catastrophe deductibles.In particular, clients in natural catastrophe zones like the Gulf of Mexico, Atlantic coast, or California, experienced above-average rate decreases due to increased capacity and new capital, Marsh said, as clients with higher loss activity and poorer submission quality were more likely to face less favourable renewal outcomes.

Importantly, Marsh noted that the US property market “remains sensitive to loss events,” particularly with the ongoing Los Angeles wildfires, which are expected to impact aggregate catastrophe losses in 2025.as a number of cat bond names recently saw further mark-downs on pricing sheets, while some aggregate cat bonds saw negative movements that had not done so before.But for now, it seems US catastrophe exposed property insurance rates are tracking, or perhaps running a little ahead of, the softening seen in reinsurance markets.

.Furthermore, in the UK, property rates fell by 4% in Q4, the same as we saw in Q3’24, however Marsh stated that several major storms which impacted the Caribbean and US mainland, led to a challenging renewal season, while secondary peril activities, such as flooding in Dubai and the recent California wildfires, may challenge insurers in 2025.In Latin America and the Caribbean, property rates experienced their first decrease for the first time in 25 quarters, as they fell 1%, which was primarily driven by significant decreases in Chile and Peru.

“The impact of claims from Rio Grande do Sul flooding on property rates diminished, though insurers remained cautious about flood coverage and often imposed restrictions,” Marsh added.In Europe, property rates remained flat, however, Marsh explained that a positive 1/1 renewal season led to increased capacity, improved pricing, and better coverage terms.Meanwhile, in the Pacific, overall property rates declined 8% in the fourth quarter of 2024, compared to a 6% decline from Q3.

According to the broker, insurers appeared to focus on premium growth, which ultimately led to increased competition for lead positions on accounts, with co-insurers offering larger line sizes on accounts they view as profitable.Across Asia, where property rates were down 3%, Marsh said that, “While capacity increased for most natural catastrophe-exposed areas, portfolios with less exposure typically saw higher rate reductions.” Canada also saw property rates down 3%, on which the broker explained that terms and conditions remained stable, with underwriting practices focused on managing secondary perils.For IMEA, so India, the Middle East, and Africa, property rates were up 3%, and Marsh said, “Where rates increased at renewal, the primary drivers were higher reinsurance and capital costs in catastrophe-exposed portfolios, heightened demand for capacity, and ongoing loss activity from floods in the United Arab Emirates (UAE) and significant losses in Saudi Arabia, India, and Africa.” “The softening of rates across property, financial lines and cyber are a positive development for clients, while the challenges in other areas of the market, particularly in US casualty, are acute.

We are committed to helping clients manage costs, protect their balance sheets, and successfully navigate the evolving market conditions,” commented John Donnelly, Global Head of Placement, Marsh..All of our Artemis Live insurance-linked securities (ILS), catastrophe bonds and reinsurance can be accessed online.Our can be subscribed to using the typical podcast services providers, including Apple, Google, Spotify and more.