As the reinsurance market moves on from the correction phase, global carrier Everest isn’t focused on short-term price movements but more its role as a solution provider, bringing access to clients, as well as global expertise and capital flexibility in an increasingly interconnected world, according to Jiten Voralia, Chief Underwriting Officer (CUO), Global Reinsurance.
Reinsurance News spoke with Voralia at the 68th annual meeting of the industry in Monte Carlo, to hear what themes he expects to dominate this year’s conference, as well as market trends and what this all means for the Bermuda-based re/insurer.
“Underwriting discipline is probably the key focus from our perspective, and what that means for us is really focusing on rate adequacy and sustainable returns,” said Voralia. “The market’s moved on from the correction phase that we had post 2022, and I would say it’s a bit more normalised. Clearly, capital levels are returning at a robust level, and competition is obviously increasing. I think in the past capacity was the differentiator, but I think now, clients are increasingly expecting deeper expertise and working closely with clients for solutions.”
As ever, there’s a lot of talk around price in the reinsurance sector, but Voralia explained that in Everest’s view, clients don’t necessarily need cheaper prices, but instead a healthy, stable market.
“They just need partners that are going to be dependable and there for what’s next when there’s going to be an inevitable change in the market,” said the executive.
On underwriting discipline, Voralia emphasised that Everest’s approach is to underwrite each and every deal.
“We don’t take a broad brush approach, so it’s underwriting on each deal on its own merits. We’re not focused on short-term price movements. We’re prepared to reduce the exposures if we feel that pricing goes below a certain threshold where risk is not being adequately compensated as well,” he said.
In terms of what might happen to property and property cat rates at the key January 1 2027 renewals, Voralia again emphasised the focus on rate adequacy and risk-adjusted returns.
“We think they’re at healthy levels at the moment, but we’re just monitoring that pretty closely. Clearly, year to date, the cat environment has been relatively benign. If it stays relatively benign, naturally, there’s going to be rate pressures, but we’re going to actively manage our position. Again, if we feel that the pricing falls below risk adequate levels, then we’re prepared to reduce exposures accordingly,” said Voralia.
On US casualty specifically, Voralia explained that Everest remains selective because of all of the well discussed issues in the space, such as social inflation, litigation trends and so on.
For reinsurers, the firming of terms and conditions (T&CS), and notably higher attachment points, was as, if not more important than the rate rises achieved during the market reset, and importantly, Voralia confirmed that for Everest, attachment points have broadly held since the correction.
“In terms of other general terms and conditions, so whether it’s event definitions, hours clauses, or it could be various other terms and conditions, that’s an area that we have to look at quite carefully, because that can be an area which is targeted for softening. From our perspective, contract wording discipline is a non-negotiable, so it’s something that we look at just as much, if not more, than rates. That’s critical. Particularly now, I think in this current risk environment, we feel that risks are becoming just more interconnected,” he said.
As the risk landscape and client expectations continue to evolve, Voralia highlighted some key areas of focus for Everest, including access.
“So, making sure that clients actually have access to local decision makers. What that means for us is making sure that underwriters in our offices are empowered appropriately so the clients can receive clear explanations, fast responses. There’ll be times when we have to say no to clients as well, and that’s okay as long as we can be clear with our rationale and again provide timely responses.
“We’re not just here to provide capacity, we’re a solution provider, so that’s bringing together global expertise across different lines of business, different disciplines, and we try to get to what we describe as the right yes for clients, so that we can get to a solution that works for both parties,” he said.
He also noted capital flexibility, specifically the expansion of the re/insurer’s third-party capital platform which has become a permanent part of Everest’s proposition.
“It enables us to write larger lines, broader balance sheet protection, and allows us to manage the market cycle much more dynamically,” he said.
“I would just summarise by saying that we’re trying to just be consistent with clients through the cycle with long-term partnerships, and I think a really good example of that is the Florida market, and property in particular. We’ve been in that market for decades, partnering with clients, providing solutions not just in the good years but through the bad years as well,” added Voralia.
