Global reinsurance giant Swiss Re has said that it expects to see further rate increases for both loss-affected and underperforming businesses, while rates elsewhere are expected to remain stable.
Throughout 2019 rates in the reinsurance industry have gained momentum, most notably in parts of the U.S. and Japan which experienced heavy catastrophe losses in both 2017 and 2018.
In an announcement at the annual meeting of the reinsurance industry in Monte Carlo, reinsurer Swiss Re has said that it expects the positive momentum to continue for loss-affected lines, adding that an abundance of available capital means that elsewhere, rates are expected to remain stable.
The reinsurer stresses that in order to ensure a long-term sustainable reinsurance market, further rate increases are required. Furthermore, Swiss Re states that the 2019 Atlantic hurricane season highlights how important it is that rates adequately reflect the risks.
Edouard Schmid, Chairman Swiss Re Institute and Group Chief Underwriting Officer (CUO), said: “The recent experience of hardening rates in reinsurance mainly reflects the response to higher loss occurrences and adverse trends in natural catastrophe markets and other affected segments. Our deep knowledge, experience and diversification make Swiss Re a strong partner for our clients in underwriting natural catastrophe risks while generating attractive returns on capital.”
Swiss Re’s Chief Executive Officer (CEO) of Reinsurance, Moses Ojeisekhoba, added: “The industry is changing for a variety of reasons. We are confident that, with our continued focus on the needs of our clients, the scale and diversification of our business, and our risk knowledge and R&D capabilities, we are in the right strategic position to address change proactively.”