The report found that that there was a rapid reload of insurance-linked securities (ILS) funds following initially overstated Hurricane Harvey, Irma and Maria losses.
There was a continued capital oversupply, despite 2017 losses, but the report found there were some modest increases in reinsurance purchases allied to underlying growth delivering real premium growth.
There was a dynamic change in reinsurance mergers and acquisitions (M&A), with large primary carriers re-entering the reinsurance market, driven by disruptive competition in personal lines and profitability challenges in life insurance.
Finally, the report found that insurance companies are continuing to assess the impact of reinsurance buying to support earnings and capital management, with the value of reinsurance seen as higher than it has been in recent years.
James Kent, Global CEO, Willis Re, said: “The pricing environment for the April renewals has closely mirrored that of the 1 January placements, with pricing dampened by the continued impact of plentiful capacity from both traditional and ILS markets, and with the latter’s impact most apparent on property catastrophe pricing.
“M&A in the sector, driven by large primary insurers returning to the reinsurance space, has also helped to keep capital plentiful, meaning that it remains a buyer’s market. However, reinsurers can take some solace from the fact that the annual price declines of recent years have abated. We are also seeing a pick-up in demand as a result of exposure growth, plus an increase in buying activity, most noticeably from some large global clients.”
Download the full 1st View report: The Willis Re 1st View report is issued three times a year. The report including specific commentary on key trends throughout the world’s major reinsurance classes and regions.
Willis Re is a longstanding member of the International Cooperative and Mutual Insurance Federation (ICMIF) and representatives from the organisation will be participating in the ICMIF Meeting of Reinsurance Officials (MORO) which takes place in Montreal (Canada) from 23-25 April 2018. The MORO Conference has a dedicated event website and the agenda with details of Willis Re speakers’ participation can be found here.