Our Scans · (FS.4.03) Reinsurance · Weekly Summary

• [New] Despite a strategic move up the risk tower, collateralized reinsurance capacity, estimated at $42 billion to $50 billion, remained below layers covered by catastrophe bonds, indicating a continued shift in capital towards catastrophe bonds and a preference for investing in remote risk layers. Insurance Business
• [New] The intensity of global risks necessitates continued vigilance and underwriting discipline to stabilize the reinsurance cycle and address the evolving nature of 21st-century risks. Insurance Business
• [New] Among the property insurance related topics up for debate in the Florida legislative session are measures that could trigger another growth surge for insurer of last resort Citizens Property Insurance Corporation, moves that would likely see it needing to grow its reinsurance and risk transfer. Artemis.bm
• As mid-year renewals get under way for the catastrophe-exposed markets of Florida, Australia and New Zealand, reinsurers are indicating a strong appetite for catastrophe risk. Artemis.bm
• Hannover Re anticipates a minimum of 5% growth in reinsurance revenue, with property and casualty reinsurance expected to see higher growth rates than life and health reinsurance. Insurance Business
• Outside of property, Moody's expects demand for casualty reinsurance to remain solid, with buyers showing greater interest in facultative covers as they explore alternative ways of lowering volatility. Reinsurance News
• US demand for catastrophe XOL reinsurance remains strong, and will grow by as much as 15% in 2024, according to Deloitte, says Moody's. Reinsurance News
• The World Bank's position on the use of disaster insurance and risk transfer backed by private capital markets and reinsurance capacity has been building over the last few years. Artemis.bm
• For the property and casualty reinsurance segment, Swiss Re expects to reach combined ratio of less than 87%, while it targets a combined ratio of less than 93% for the corporate solutions business. Morningstar, Inc.
• Given the continued higher reinsurance pricing and expected stronger performance of reinsurers as a result, many sidecars are likely to deliver good returns again in 2024, catastrophe loss activity allowing. Artemis.bm
• Companies awarded exploration rights will most likely rely on the provision of services from some of the world's biggest insurance and reinsurance companies, mostly concentrated in Europe and North America. allAfrica.com
• Demand for catastrophe reinsurance is expected to grow by 15% in 2024, with catastrophes in 2022 causing $1 billion in losses and ultimately driving up costs by 30.1% in 2023. Insurance Business
• Cat bonds need replacing Citizens Property Insurance Corporation, could increase its purchase of reinsurance and catastrophe bond backed risk transfer in 2024, with its new layer structure following the merging of its accounts suggesting as much as $5.5 billion could be purchased in 2024. Artemis.bm
• Whether reinsurer appetite for risk in Florida persists through the renewals of 2024 will very much depend on the loss activity seen in 2023, but also on the sustainability of rates. Artemis.bm
• Primary insurers are retaining a growing share of their catastrophe risk, particularly with regard to secondary perils, as reinsurers raise attachment points and rates. Reinsurance News
• As reinsurers try to recoup their share of the 2023 natural catastrophe losses, insurance rates could rise by more than 15% as a knock-on impact of higher reinsurance costs. Reinsurance News
• The rating agency is not anticipating much change to reinsurer appetites for risk in 2024, so expects that changes to attachment points will remain, while the appetite for aggregate reinsurance is not expected to increase much, if at all. Artemis.bm
• The credit ratings of global property insurers are coming under pressure as rising reinsurance costs force them to cut back on cover and retain more risks themselves. Insurance Journal
• Insurance companies have pointed to three main reasons that doing business in California is increasingly a losing proposition: Escalating wildfire risk, ever-rising construction costs and the global price of reinsurance - insurance policies that insurance companies, themselves, take out. North Coast Journal
• Serious Tokyo earthquake could be $ 130-150 bn industry loss: Swiss Re The global insurance and reinsurance industry could face in the region of $130 billion to as much as $150 billion of losses if a really severe earthquake strikes the Tokyo region of Japan. Artemis.bm
• Seismic risk in Japan remains extremely high and as a result it has been a focus for insurance-linked securities capacity, with catastrophe bonds and collateralized reinsurance both featuring within insurer reinsurance towers there. Artemis.bm
• One of the biggest reasons insurance companies are in a good financial position to pay claims in 2023, is because insurers have been able to obtain satisfactory policies from reinsurance companies, which insurance firms use to cover some of their risks. CNN

Last updated: 17 April 2024