U.S. insurance programs with catastrophe exposure averaged between 10 percent and 20 percent increases in the first quarter of 2012, according to a insurance briefing issued by broker Marsh on Tuesday.
“[A] continuation of the transitional insurance market that began midway through 2011 for property risks continued in the first quarter of 2012, with more insureds experiencing rate increases than those that saw rates remain flat or decreasing [in the U.S.], the report says. “In the short term, this trend is likely to continue, and we expect that the average rate of increase will rise month over month as it has since late in the third quarter of 2011.”
The report argues rate increases were driven by catastrophic losses experienced in 2011. In addition, risk model changes made last year will also push rates up through the first half of 2012
Globally, Marsh said that catastrophe exposed areas in Japan and New Zealand saw rate increases greater than 30 percent in the first quarter while regions of Australia ravaged by floods saw increases of up to 20 percent.
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