For the foreseeable future, SCOR’s Global P&C CEO, Jean-Paul Conoscente, expects the property and casualty (P&C) reinsurance market to remain broadly where it is today after the renewals of 2024, absent any major events.
SCOR reported its second-quarter results today, including updates on the June and July 2024 reinsurance renewals. The company continues to grow in its preferred and diversifying lines, maintaining terms and conditions along with the high profitability of its P&C reinsurance portfolio.
During the Q2 2024 results call, Conoscente highlighted strong growth in renewals, leading to a more profitable portfolio with an estimated improvement of 1.4 points over last year.
“Beyond price, on cat XL renewals, discussions focused on terms and conditions, and in particular, on attachment points. Competition increased on the higher layers but market discipline remained very strong on the lower layers. And as a result, the overall price adequacy of cat XL business remains very high,” Conoscente noted.
At the mid-year renewals, SCOR experienced a robust 24% growth in estimated gross premiums across all regions, increasing the size of the book to €956 million from last year’s €774 million. This growth was primarily driven by North America and Alternative Solutions, with the latter rising from 4% of total premiums in last year’s June and July renewals to 12% in 2024.
Conoscente commented further on this, stating, “Alternative solutions more than doubled in size, while specialty lines achieved 25% growth.”
In terms of casualty, he explained that SCOR reduced premium volume on US casualty as it continues to see market improvements as insufficient to cover the increased expected claims cost.
“We continue to expect double digit claims inflation between 10% and 15% for US casualty, depending on the segment. We therefore maintain a flat capital allocation to US casualty throughout the year, allowing us to support selective key clients while remaining cautious and underweight overall,” he said.
On climate risks, Conoscente said that the issue remains a major concern in the industry, with widespread caution driving increased demand fort catastrophe reinsurance.
“With the June and July renewals, on a like to like basis, we are beginning to see a moderate reduction in rates driven by adequate market capital and increased capacity from incumbents. However, price adequacy remains overall very strong. For our part, we have grown our cat portfolio selectively, while keeping exposure growth in cat flattish year on year,” said Conoscente.
Overall, Conoscente expressed confidence that, barring major events like a large catastrophe in the second half of 2024, the market will remain stable with minor price changes and strong price adequacy.
“In this environment, we’ll continue to expand our portfolio, leveraging our strong client relationships to successfully deliver on the missions of our forward 2026 plan,” he said.
