Reflecting on the 1/1 2024 renewals, AXA XL Reinsurance’s Chief Executive Officer (CEO), Renaud Guidée says that the market is “gradually progressing towards adequacy and normalising.”
In a report posted by the organisation, he explained that it is extremely important that the industry is getting back to a clearer and more sound positioning between insurers and reinsurers, “where insurers have to bear the frequency, attritional risks, while reinsurers are there to support them in case of large losses and beyond.”
He continued: “It’s really a division of labour between insurers and reinsurers. This is how I see the market shaping going forward. It’s not just a matter of the 2024 renewals. It’s not cyclical, it’s really secular, and it’s how the industry should operate.
“In terms of capacity, the players that have a robust balance sheet will be able to continue to deploy capacity. However, it’s true that the market may become more selective and more discriminating and some players with less solid balance sheets which were relying on a delusional, permanent low-interest-rate regime might have trouble providing capacity at the same level as they did over the past few renewals and the past few years.”
Moreover, another key discussion point which remains at the top of the agenda for many reinsurers, has been around the type and scope of reinsurance cover offered.
“When it comes to terms and conditions, what I can see from the discussions in SIRC, in the Monte Carlo Rendez-vous, in Colorado Springs’s CIAB is that there’s a convergence of views between insurers and reinsurers on the importance of having terms and conditions that reflect the intended coverage and that any effort has to be shared with the policyholders,” he explained.
However, Guidée stated that it all comes down to the wording of the policy with the ultimate client and then the programmes, the treaties, or when applicable, the facs with reinsurers are a follow-on.
Looking ahead towards the next 12 months, Guidée remains realistic, but at the same time, bullish.
He explains that the company is very happy with it’s portfolio as it stands, which ultimately means that the firm has a platform for growth and that they are ideally positioned.
In terms of growth, it’s really across the board that AXA XL will look for attractive opportunities in terms of geography, according to Guidée.
“We have a global footprint with local presence here in Asia, with our team based out of Singapore and covering our clients, which means that we can make the most of that global reach and local connectivity.
“We will be pretty holistic in our review of opportunities across the Asia-Pacific region. We have comprehensive coverage – and another clear competitive edge is the quality of our credit. We have a credit rating of AA- and a rock-solid balance sheet, which really stands out in the industry.”
Lastly, Guidée explained that AXA XL plans to deepen it’s relationship with it’s clients throughout 2024, as well as expand shares in existing programmes where the conditions are met in terms of price, in terms of structure and in terms of overall adequacy.
The firm will also look to continue looking out for new clients to support them, as well as also broaden the company’s client base too.
