Insurance buyers across Europe, the Middle East and Africa (EMEA) are reaping the cost benefits created by greater competition among insurers for their business and the added capacity generated by new entrants to the market, according to a report published by Marsh.
Marsh’s report, Competition Nets Rewards, EMEA Insurance Market January-June 2010, finds that many organisations across EMEA were able to secure premium rate reductions for their property/casualty insurance in the first half of 2010– despite insurers striving for rate increases, particularly on renewals.
Among the changes to insurance rates for other classes of business across EMEA in the first half of 2010, compared to July-December 2009, Marsh found:
- Professional indemnity: rate reductions of up to 20-30 percent, compared to minus 10-20 percent in 2009.
- Directors’ and officers’ liability: rate reductions up to 10-20 percent, compared to minus 10 percent in 2009.
- Motor: rate reductions of up to 20-30 percent, compared to minus 40-50 percent.
Marsh’s report also found that the market for trade credit and financial institutions (FI) insurance coverage across EMEA has begun stabilising, as insurers become more comfortable with their exposures and new entrants add fuel to existing competition for business.
- Reductions in trade credit insurance coverage ranged from 10-20% in Ireland and Poland, and 0-10 percent in Turkey and Italy, while 14 countries, including the UK, reported no change in the last six months.
- 20 countries across EMEA reported no change or a reduction in pricing for their financial institutions’ insurance, with the UK, Germany, India, Israel, Turkey and Croatia all reporting reductions of between 0-10 percent.
“While some countries across EMEA are still reporting an upward trend in trade credit and FI insurance rates for the past six months, there are strong signs that increased competition has spurred some insurers to put some of their previous caution aside,” said Jeremy Cooke, global head of Market Relationship Management at Marsh
“It is still challenging to find adequate cover at reasonable rates for large FIs and banks. However, Marsh believes that conditions will continue to improve in the second half of the year, particularly for firms which have good risk profiles and are based in territories with more stable economic prospects.
Cooke said that in the absence of any significant losses, Marsh expects that the most competitive lines of business in EMEA will remain unchanged for the remainder of 2010, given the excess capacity in most markets and increasing competition among insurers for business and market share.
Marsh’s report, EMEA Insurance Market January-June 2010, analyses 10 major commercial insurance lines across 42 countries in EMEA.
Was this article valuable?
Here are more articles you may enjoy.