With the completion of the January 1 renewals, Everest Re has headed into 2023 with an improved portfolio and expanded margins, said the re/insurer’s President and Chief Executive Officer, Juan Andrade.
Looking forward to future opportunities at upcoming renewals, Andrade noted that the firm expects reinsurance pricing momentum to continue, as well as growing opportunity and more portfolio diversification.
Andrade said: “The January 1 reinsurance renewals are executed by our global reinsurance team with equal precision, and as a result, we have a significantly stronger portfolio heading into 2023 and beyond.
“We approached the January 1 renewals from a position of strength, with a superior value proposition, well prepared to support our clients, and take advantage of excellent market conditions around the world. We set clear goals for our portfolio, and we achieved every one of them by leveraging Everest’s global market leadership and setting early expectations with clients and brokers, which drove significant pricing improvements.”
In addition to rate, the re/insurer substantially improved terms and conditions, Andrade noted. It targeted attractive property opportunities, both domestically and internationally, at materially improved risk-adjusted returns.
The firm also drove higher attachments, and reduced exposure to named and secondary perils.
Andrade noted that property cat saw significant rate increases across all geographies. In North America, the property cat XoL risk-adjusted rate change was up approximately 50%.
The average attachment point for Everest Re global property cat business also increased meaningfully, which resulted in significantly reduced risk exposure. At the same time, the expected return for the firm’s cat portfolio increased materially.
In casualty and professional lines, pricing and terms and conditions continue to improve overall. The firm leveraged the hard property market to strengthen and further diversify the portfolio, added Andrade.
Internationally, the January 1 renewals excited Everest Re’s expectations throughout Europe and Asia, the CEO revealed. The firm grew its regional portfolios through increased participation and by expanding its base of new clients.
Additionally, it also saw significant rate movement in specialty lines exposed to the Russia/Ukraine war, particularly in marine, aviation, and political violence.
“I am very pleased with the performance of our outstanding reinsurance team,” said Andrade. Everest distinguished itself in this renewal by our early and consistent communication with our brokers and clients.
“We set expectations heading into 1/1, and constructively worked with them to find solutions. As a result, we improved our portfolio, and expanded margins while deepening our relationships with brokers and clients.”
Looking forward to future 2023 renewals, Everest Re expects the reinsurance pricing momentum to continue.
“We see abundant opportunity to continue growing and diversifying our portfolio in all markets. Focused on further growth in Asia and Europe, while capitalising on the continuing market dislocation in property,” Andrade commented.
He warned: “Given significant firming of the reinsurance market on January 1, and the heightened risk environment, primary insurers should also see firming prices in 2023. They will need to maintain underwriting discipline.”
