Exploring Global Insurance Trends

Dive into the shifting landscape of commercial insurance with this compelling conversation between Tony van Niekerk of COVER and Omar Gemei, Head of Global Placement & Bowring Marsh – India, Middle East & Africa, examining the forces reshaping the market and what they mean for businesses navigating risk in 2025.

The headline finding from Marsh's Q2 Global Insurance Index reveals a 4% global decline in commercial insurance rates, with the IEA region experiencing an even sharper 5% reduction. This marks the fourth consecutive quarter of rate decreases, signaling a sustainable soft market driven by heightened insurer competition and expanding capacity. Omar explains how increased supply of insurance capital is outpacing demand, creating favorable conditions for clients seeking better pricing and terms.

South Africa presents a particularly interesting case study. Large risk-managed clients are securing reductions exceeding the regional average as London wholesale markets compete aggressively with local retail insurers for premium business. The conversation reveals a welcome return to subscription-based placements where all participants follow the lead insurer with uniform pricing and terms—a departure from the fragmented approach of the hard market era.

While most lines are softening, Omar discusses notable exceptions, including US casualty rates that rose 4% due to social inflation and substantial jury awards. Remarkably, South African casualty markets bucked this trend, demonstrating resilience and stability that sets the region apart.

The episode explores sophisticated risk management strategies gaining traction, from self-insurance programs to captive formations, particularly among Middle Eastern multinationals. Perhaps most intriguing is the cyber insurance paradox: despite growing systemic risks and increasing cyber threats, pricing continues to decline as underwriters gain confidence and new capacity floods the market.

Whether you're evaluating your organization's insurance strategy, considering alternative risk financing, or simply want to understand where the market is heading, this episode delivers actionable insights from a leading industry expert. Omar's analysis provides clarity on market sustainability and opportunities businesses should explore before conditions inevitably shift again.

Key points

Market Trends

• Global rate decline: Commercial insurance rates decreased 4% globally in Q2 2025

• Regional performance: IEA region saw 5% decline, bucking the global average

• Sustained trend: Fourth consecutive quarter of rate decline, indicating this is a trend rather than an anomaly

• Market forecast: Soft market conditions expected to continue through 2025 (barring major catastrophic events)

South Africa Specifics

• Competitive dynamics: London wholesale market competing aggressively with South African retail market for large accounts

• Larger reductions: Risk-managed clients seeing reductions beyond the 4-5% average

• Placement evolution: Return to subscription-based placements with "follow the lead" structures, providing uniform pricing and terms

Drivers of Change

• Supply exceeds demand: Increased competition among insurers and expanded market capacity

• Larger commitments: Insurers writing bigger lines and higher limits than in the past

Line-Specific Insights

• Casualty exception: US casualty rates increased 4% due to social inflation and nuclear jury awards

• South African stability: Local casualty market remained stable, showing resilience

• Cyber insurance: Rates declined 5% in South Africa despite growing systemic risks

Alternative Risk Financing

• Growing sophistication: Middle Eastern companies establishing captives as they become multinationals

• Strategic shift: Movement from traditional policies toward custom-built solutions tailored to specific risk profiles