Global Commercial Insurance Rates Decline 4% in Q2 2025, Fourth Quarterly Drop

In a significant shift within the insurance sector, global commercial insurance rates saw an average decrease of 4% in the second quarter of 2025, following a 3% decline in the first quarter. This trend marks the fourth consecutive quarterly drop in rates, according to the latest Global Insurance Market Index released by Marsh, a leading insurance broker and risk advisor, on July 24, 2025. The decline is attributed to increasing competition among insurers, leading to enhanced market capacity, more favorable rates, and broader coverage options.

The report indicates that all global regions experienced year-over-year composite rate decreases ranging from 4% to 11%, with the exception of the United States, where rates remained flat. The Pacific region and the United Kingdom observed the most substantial rate reductions, at 11% and 6%, respectively. Other regions, including Asia, Latin America and the Caribbean (LAC), and India, Middle East and Africa (IMEA), saw decreases of 5%, while Canada and Europe experienced a 4% decline.

Historically, the trend of declining insurance rates began in the first quarter of 2021, following seven years of consistent increases. The current market dynamics reflect a significant shift in insurer strategies, prompted by competitive pressures. Property insurance rates globally fell by 7% after a 6% decrease in the previous quarter, with the US and Pacific regions leading the declines at 9% and 13%, respectively.

Conversely, casualty insurance rates increased by 4% globally, primarily driven by a notable 9% rise in the United States. This increase is largely attributed to the frequency and severity of casualty claims, characterized by significant jury awards, often referred to as "nuclear" awards. Financial and professional lines also showed a continued moderation, decreasing by 4% in the second quarter compared to a 6% decline in the first.

Cyber insurance rates followed a similar downward trend, decreasing by 7% globally, with LAC experiencing the most substantial drop at 17%, and Europe seeing a 15% decline.

John Donnelly, President of Global Placement at Marsh, commented on these developments: "Mounting competition among insurers with ambitious growth targets is providing reduced pricing and broader coverage options. However, rising casualty rates in the US raise concerns for clients. Geopolitical issues, such as tariffs and cross-border conflicts, continue to create challenges and uncertainties, prompting organizations to explore various attractive traditional and alternative financing strategies for risk management. Clients are encouraged to collaborate closely with Marsh to evaluate exposures and risk appetites, identifying potential areas for broader coverage compared to previous years."

Marsh, a business of Marsh McLennan, is recognized as the world's leading insurance broker and risk advisor, operating in 130 countries and serving clients across multiple sectors. With an annual revenue exceeding $24 billion and a workforce of over 90,000, Marsh McLennan's diverse expertise positions it to help clients navigate the complexities of risk management in today's dynamic environment. For further information, please visit marsh.com or follow the company on LinkedIn and X.