Best’s Market Segment Report: Strong Technical Profits Bolster Momentum for Global Reinsurers
2024年8月14日 - 4:00PM
ビジネスワイヤ(英語)
A market reset by global reinsurers designed to de-risk
portfolios, realign relationships with primary carriers and improve
pricing generated strong technical results for the segment in 2023,
according to a new AM Best report.
These efforts have included a much-needed shift away from
high-frequency layers, the adoption of tighter contract wording,
and a better-defined scope of cover with the combined effect having
repositioned reinsurers’ traditional role to focus on providing
capital protection to cedents, rather than stabilize earnings.
The Best’s Market Segment Report, “Strong Technical Profits
Bolster Momentum for Global Reinsurers,” is part of AM Best’s look
at the global reinsurance industry ahead of the Rendez-Vous de
Septembre in Monte Carlo. Other reports, including AM Best’s
ranking of top global reinsurance groups and in-depth looks at the
insurance-linked securities, Lloyd’s, health and regional
reinsurance markets, will be available during August and
September.
AM Best believes that hard pricing conditions in reinsurance are
likely to last longer than in previous cycles for several reasons.
Chief among those -- persistently high claims activity is being
driven more by the accumulation of medium-sized losses and
secondary perils than by single, major catastrophic events. The
report also notes that the global reinsurance segment remains
well-capitalized and these companies’ solvency positions have not
been under meaningful pressure, apart from unrealized investment
losses on fixed-income instruments which have reversed.
“The current hard cycle has not been characterized by capital
depletion,” said Carlos Wong-Fupuy, senior director, AM Best.
“Unlike previous hard cycles and despite the very attractive
pricing environment, new company formations have not materialized,
particularly in the property catastrophe space. Disappointing
results during the previous, prolonged soft market deterred
potential new investors.”
Following the market dislocation during the January 2023
renewals—after the uncertainty caused by Hurricane Ian just a few
months earlier—AM Best observed an unequivocal change confirming
the current hard market conditions. While benchmarking of
reinsurers across the globe is now being challenged by the adoption
of IFRS 17 accounting standards, the segment continues to expand
and is producing return on equity at levels well in excess of their
cost of capital. Meanwhile, combined ratios show very strong profit
margins, more than offsetting concerns about adverse reserve
development on certain legacy books of business, in particular U.S.
casualty.
To access the full copy of this market segment report, please
visit
http://www3.ambest.com/bestweek/purchase.asp?record_code=345543.
A video discussion of this report also is available at
http://www.ambest.com/v.asp?v=ambglobalre924&AltSrc=182 .
For future global reinsurance reports ahead of Rendez-Vous de
Septembre, please visit Best’s Research.
Lastly, AM Best will host its annual reinsurance market briefing
at Rendez-Vous de Septembre on Sept. 8, 2024, at 10:15 a.m. (CEST)
in Monte Carlo. For more information, please visit
http://www3.ambest.com/rd/rd.aspx?rd=RVDS2024.
AM Best is a global credit rating agency, news publisher and
data analytics provider specializing in the insurance industry.
Headquartered in the United States, the company does business in
over 100 countries with regional offices in London,
Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more
information, visit www.ambest.com.
Copyright © 2024 by A.M. Best Rating
Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
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Carlos Wong-Fupuy, FIA, FRM Senior Director, Global
Reinsurance +1 908 882 2438
carlos.wong-fupuy@ambest.com
Edem Kuenyehia Director, Market Development
& Communications +44 20 7397 0280
edem.kuenyehia@ambest.com
Dr. Mathilde Jakobsen Senior Director +31 20
808 3118 mathilde.jakobsen@ambest.com
Christopher Sharkey Associate Director, Public
Relations +1 908 882 2310
christopher.sharkey@ambest.com