The “gradual easing of the hard market” in 2024 led to an improvement for reinsurers, though less pronounced than in 2023, particularly in reinsurance terms and program structures, as per Hervé Nessi, Arundo Re’s Chief Underwriting Officer.
In the firm’s 2024 Activity Report, Nessi observed that primary reinsurance rates continued to increase overall, but these increases were moderate, with specific adjustments based on claims experience.
“Conditions were adjusted for the individual merits of each customer worldwide, except for markets that experienced major losses in 2023, such as Italy, Turkey and Mexico, where the adjustments were significant and applied more generally to the majority of insurers,” the CUO said.
In the 2024 Activity Report, Nessi also provided insights into the performance of the reinsurance market, noting that following an undeniably favourable year for reinsurers in 2023, the 2024 renewals were broadly seen as a return to stability.
“Reinsurance capacity for natural catastrophes was sufficient to meet demand, creating a competitive environment, particularly for major perils and traditional tranches,” Nessi stated.
During this period, many reinsurers reportedly positioned themselves with significant growth ambitions.
“However, the international landscape remained challenging, marked by persistent inflation, increased geopolitical instability, financial pressures from secondary perils, and increasingly complex policy wording in response to constant regulatory changes,” Nessi said.
In addition, these renewals were said to be characterised by relatively short response times, adding uncertainty for some market players.
Despite ongoing challenges, Arundo Re generated turnover of €1.361 billion in 2024, an increase of 15% year-on-year, as the company’s undiscounted combined ratio strengthened by 1.9 percentage points to 94.7%.
The reinsurer explained at the time that the 15% growth in turnover, or 12% at constant exchange rates, was driven by both non-life and specialties in all geographic regions.
Meanwhile, the improved underwriting performance came despite what the firm described as “an exceptional accumulation of events in Canada”, which included wildfires, hailstorms, flooding, and a cyclone, as well as “a high frequency of medium-sized claims directly linked to climate change.”
