European reinsurance rates up as renewals get underway
Bermuda re/insurers are also seeing slightly higher gains for Europe and flat rates for retrocession, Wells Fargo told clients in a note following talks in Bermuda with reinsurers, ILS funds and brokers.
“Our sense is pricing during the 1.1 renewals will be up modestly (~5%) for US cat re and could be flat for retro business,” analysts said.
“The pricing view we got from underwriters and brokers was mostly consistent” with some discrepancy in views on retro where brokers see mild 5-10% rate declines and underwriters say flat.
Pricing is up 7-12% for European business which Wells notes was more burdened by recent losses and did not adjust as heavily as the US last year.
Terms and conditions, most notably 2023’s heightened retentions, are apparently holding at levels set last year, Wells said of its take.
Renewals are proceeding at an improved pace. Renewals show a “very organised market” compared to last year “with plenty of supply and slightly higher demand.”
“This year reinsurers are more willing to write business,” Wells analysts wrote.
About one-third of January 1 business has already been bound, with expectations that as much as 50% of business could be bound by end week. Some 5-10% had been bound this time last year, Wells said for comparison.
