Bermuda:Re+ILS’ Post

The global property catastrophe re/insurance market experienced notable growth in the first half of 2024, driven by improved profitability and increased capital among reinsurers. Guy Carpenter's review estimates an additional $35-40 billion in catastrophe limits purchased worldwide, with significant activity in North America. https://hubs.la/Q02JqLX80

SCOR is back in the catastrophe bond market in search of more peak catastrophe peril retrocession, seeking $125 million or more in North America focused coverage from an Atlas Capital DAC (Series 2024-1) issuance.

One of the talking points at the Monte Carlo Rendez-Vous was the expectation that more demand for catastrophe reinsurance will emerge at the higher layers of towers, which should help to ensure the catastrophe bond market continues to expand.

"Higher layer reinsurance demand can drive catastrophe bond market growth" This content is copyright to www.artemis.bm and should not appear anywhere else, or an infringement has occurred. One of the talking points at the Monte Carlo Rendez-Vous over recent days was the expectation that more demand for catastrophe reinsurance will emerge at the higher layers of ceding company towers, something which should help to ensure […] https://lnkd.in/g4chJ9Tc

Property catastrophe #reinsurance rates fall 5%, says Howden Re. The reinsurance market is experiencing a period of adjustment, due in part to a resurgence in dedicated sector capital, which now exceeds 2021 levels. This recovery, supported by strong ILS inflows, has increased capacity at the top of programmes and led to risk-adjusted rate reductions in higher layers. Buyers and sellers engaged early in the year, with cedents targeting better terms and conditions to address previous increases in limits and attachments, as well as narrower wordings. Reinsurers exhibited a proactive stance by completing many programmes early, enabling the deployment of increased retrocession capacity as the renewal drew near. This strategic approach enabled some buyers to achieve more favourable terms in what remains a cautious market. Wade Gulbransen, Howden Re Head of North America, commented, “It is crucial that our clients secure optimal coverage in this rapidly evolving landscape. This means not only finding capacity, but also ensuring it aligns with their risk profiles and financial objectives. Our focus remains on providing innovative thinking alongside dynamic placement strategies to meet these challenges head-on.” “The reinsurance market is at a critical juncture. While the recovery of dedicated capital and increased capacity signal a potential softening of rates, the forecasted active hurricane season and other market pressures could counteract these trends. Strategic adaptability and expert guidance are essential in navigating these dynamics.” David Flandro

Reinsurers have their ears to the ground on #climatechange losses, and Canada’s record #wildfire season is adding to the heat. Still, wildfire losses aren’t expected to raise reinsurance renewals for Canadian carriers exponentially, say Jeff Turner of Acrisure Re and Matt Wolfe of Aon.

Catastrophe reinsurance rates for Bermuda re/insurers are expected to remain stable for the mid-year renewals and some companies will lean into Florida renewals as well, according to research company Jefferies. Read the full story here: https://ow.ly/15H850RSr5x

Over the second-half of 2023, the catastrophe bond market has continued in its shift away from providing aggregate cat bond coverage, with the percentage of the outstanding cat bond market that aggregate deals contribute falling below 42% for the first time in years.

Property catastrophe reinsurance rates-on-line slowed further at the recent mid-year renewals, with a general flat to slightly down rate environment, resulting in Guy Carpenter’s U.S. Property Catastrophe Rate-On-Line Index now being up by just 1.2% in 2024.

Over the history of the catastrophe bond market, sponsors have recovered some 2.69% on a paid loss basis, which on a reported loss basis would have seen recoveries of 3%, according to Swiss Re Capital Markets.