Reinsurance broker Guy Carpenter’s mid-year reinsurance renewal report reveals that some upper layers of property placements saw risk-adjusted decreases of 10% or more for accounts without loss impacts.
However, the broker finds that mid-year 2024 global property catastrophe reinsurance risk-adjusted rates were generally flat to mid-to high-single digits.
The report noted that while there was more capacity available for upper layers of property programmes, the appetite for lower layers was somewhat constrained.
However, there was a slight increase in reinsurers moving lower into programmes to secure shares higher in the structure. The significant rise in demand for catastrophe reinsurance was easily met by the growing market appetite.
Guy Carpenter’s preliminary mid-year US Property Catastrophe Rate on Line (ROL) Index, which considers structural adjustments and current risk perspectives, showed minimal change year-on-year.
Pricing varied significantly based on account-specific factors like portfolio composition and historical pricing trends.
Guy Carpenter attributes these challenges to slightly lower than anticipated mid-year raises, influenced by an increased North Atlantic hurricane forecast and the desire to realise fund gains.
Risk programmes were scrutinised as reinsurers remained concerned about the frequency and severity of large risk losses.
Prices continued to ease in the first half of 2024, though ILS-supported transactions faced some recent difficulties. Overall, the reinsurance broker reported that renewals remained stable, and in some cases, terms improved.
Many markets aimed to maintain adequate pricing but were flexible with previously strict requirements. Pressure on attachment points remained, and solutions for volatility continued to be sought.
