Reinsurance giant Swiss Re said this morning that it expects the impacts of recent catastrophe losses will be sufficient to stabilise reinsurance industry pricing.
The company said that it intends to maintain its underwriting discipline, in the face of continuing pressures from low interest rates and excess capital in the sector.
The firm believes that in this way it can be a more sustainable business and make it a more reliable underwriting partner for its clients.
Looking ahead to the next renewals Swiss Re said that it expects stability in property reinsurance pricing due to recent loss events. Hurricanes Harvey and Irma have caused tens of billions of dollars of losses for the industry to deal with, which will drain away some of the excess capital.
In casualty lines of reinsurance Swiss Re forecasts some corrections in pricing to reflect recent loss trends. In specialty lines the reinsurer said that price trends at the renewals are likely to vary, depending on market and class of business.
Analysts also said that the impacts of hurricanes in the last few weeks will put a more stable floor under reinsurance renewal pricing, but that newly entering capital could also flood the market if investors deem this the right time to deploy more.
Price stabilisation is only anticipated to be local at best though, according to equity analysts, with declines still possible in January in other regions of the world and it may only be the U.S. property catastrophe reinsurance market that stabilises fully, or perhaps firms slightly.