Property-catastrophe reinsurance pricing saw continued moderation at the June 1 renewals with a selective return of capacity following historic pricing strength, according to Howden Re, the reinsurance and advisory arm of Howden.
While rate moderation continued and reinsurers’ appetite expanded moderately, “underwriting rigor persisted, especially in structurally challenged layers,” said Howden Re’s June 1 renewal report.
Risk-adjusted rate-on-line changes ranged from flat to down 20%, depending on loss experience and attachment point, the report said, noting that, despite pricing pressures, programs generally attracted subscriptions above 100%.
Renewals in Florida were marked by increased appetite from traditional reinsurers, which appeared confident in litigation reforms and viewed pricing as attractive after years of caution, the report indicated.
Property-Catastrophe XoL
In the property-catastrophe excess-of-loss (XoL) reinsurance market, capital inflows have rebounded, with newly formed reinsurers and syndicates deploying meaningful capacity into mid-year placements, the report confirmed.
“As such, expanding supply continues to outpace rising demand, underpinned by improved reinsurer retained earnings and sustained catastrophe bond activity, including the issuance of new and upsized transactions at the upper layers of reinsurance programs,” Howden Re continued.
As a result, the broker said, remote-attaching cat-XoL layers have experienced rate reductions in the range of 10% to 20%.
