Global property insurance rates drop 12 percent
Global property insurance rates fell 12% in the second quarter of 2026, continuing an eight-quarter decline as a soft market spread across major regions, according to data from broker Marsh Risk.
The decrease was most pronounced in India, the Middle East, and Asia, where rates dropped 19%. The U.S., U.K., Pacific, and Latin America and the Caribbean also saw double-digit reductions. These shifts stem from excess capacity and intense competition among insurers, fueled by strong earnings, surplus capital, and reduced reinsurance expenses.
Competition drives broader coverage and lower costs
Insurers are not only lowering prices but also improving terms. John Donnelly, president of global placement at Marsh Risk, noted that carriers are offering expanded policy terms and reduced deductibles to attract clients. Some policyholders are keeping the savings, while others are redirecting funds into alternative risk strategies like captives.
“Market conditions will probably stay this way unless a severe northern hemisphere storm season or a series of major natural disasters occurs,” Donnelly said. “Clients should use this time to enhance coverage and adjust program structures before conditions change.”
The decline has been consistent. Rates dropped 12% globally in Q2 2026, following 9% decreases in Q1 2026 and Q4 2025. Underwriters continue to prioritize catastrophe exposure, with risk quality and management influencing outcomes.
Regional breakdown: steepest drops in IMEA, Pacific
The IMEA region experienced the largest decrease at 19%, compared to a 10% decline in the previous quarter. The Middle East faced significant losses, with property damage estimated at $2 billion and political violence claims surpassing $3 billion.
In the Pacific, rates fell 15%, marking the ninth consecutive quarter of declines. Clients there obtained higher policy limits and sub-limits, especially for natural catastrophe risks, and in some cases lowered their retentions.
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Latin America and the Caribbean saw a 14% decline, led by Brazil and Chile. Aggressive pricing and abundant capacity—both local and international—intensified competition, while lower reinsurance costs allowed insurers to allocate more capital.
The U.S. recorded a 13% decrease, its eighth straight quarter of declines. Programs with catastrophe exposure and premiums over $1 million saw rates fall 20%, while smaller, non-catastrophe programs dropped 10%. Global capacity and high competition expanded placement options even in riskier sectors.
The U.K. saw an 11% reduction, compared to 10% declines in the prior two quarters. Underwriters remained focused on catastrophe exposure and site-specific risks despite a generally mild loss experience.
Current conditions may give buyers more negotiating power for better terms. However, the market’s stability depends on avoiding major disasters, an uncertain prospect.
For now, the soft market persists. Insurers continue to compete aggressively, and clients are benefiting. How long this trend lasts remains unclear, especially as the next storm season approaches.
Investors tracking these shifts may find opportunities in related sectors, including logistics and tech firms adjusting to new risk settings.
