STATISTICS:

JLT Re: Soft market prevails at January 1st, but uncertainty over final impact of the record loss quarter remains

The market continues to be driven by the abundance of both traditional and alternative reinsurance capital rushing in to fill the massive Q3 insured losses, but uncertainty over the final impact of the record loss quarter remains, JLT Re's Global Head of Analytics, David FLANDRO said commenting on the January 1st renewals.

FLANDRO said that "while supply and demand dynamics initially tightened in business lines with heavy losses, pressures were offset by post-HIM capital deployments through channels such as new collateralised vehicles, post-event funds, new catastrophe bond issuances and increased stamp capacity and pre-emptions. Investors responded to opportunities in both the reinsurance and retrocession markets, resulting in the replenishment of a significant portion of lost capacity in time for renewals."

The JLT Re analytics expert added that although capacity levels are plentiful across most lines of business, and the bulk of 2017 losses were within modelled expectations, uncertainty over the ultimate cost to reinsurers and ILS investors during renewals remains. "This uncertainty was compounded by the recent wildfires in California. Any significant changes to loss expectations in the coming months could potentially affect pricing," FLANDRO added.

2017 was the first year since 2008 in which dedicated reinsurance capital declined, having fallen by roughly USD 15 billion in the second half of 2017, however, the JLT Re analytics expert explained that reinsurance capital remains at about USD 45 billion or 17% above gross premiums.

Looking ahead, FLANDRO said the reaction of traditional carriers and capital markets to future reserve development and loss experience will be important in shaping the reinsurance market this year.

Follow XPRIMM Publications on LinkedIn, for more data on the insurance and financial industry.

Share |

Related articles

AXA: acquisition of XL Group completed

AXA has announced on September 12 that it has completed the acquisition of XL Group Ltd, a leading global Property & Casualty commercial lines insurer and reinsurer with strong presence in North America, Lloyd's, Europe, and Asia-Pacific.

2018-09-13

QBE's received approval to move its European business to Brussels

QBE European Operations, the business insurance specialist, part of the Australian QBE Insurance Group, has received the High Court approval for moving its general insurance business written through its European branch network to QBE's new Belgian (re)insurance entity, QBE Europe SA/NV.

2018-09-11

ON THE MOVE

TOP EVENT

photodune-3834701-laughing-girl-xs

LIVE: 1st National Reinsurers Summit in Moscow: focus on global cooperation

Today has started in Moscow the 1st National Reinsurers Summit "National Reinsurers: Focus on global cooperation". Organized by the Russian National Reinsurance Company (RNRC) with the support of the Central Bank of the Russian Federation, the conference has the xprimm.com insurance portal as Media Partner.

20.09.2018

photodune-3834701-laughing-girl-xs

LIVE from Monte Carlo: The 62nd edition of the "Rendez-Vous de Septembre"

The 62nd edition of the "Rendez-Vous de Septembre", the annual traditional meeting of reinsurers starts Sunday in Monte Carlo. XPRIMM Publications covering the CEE, SEE and CIS insurance markets are available at the XPRIMM stand in Fairmont Hotel, as well as at the most important venues in Monte Carlo.

13.09.2018

Willis Re - Market still soft, but functional

Despite the high losses from 2017 the reinsurance market is still soft, James KENT, Global Chief Executive Officer (CEO) of Willis Re stated at a press briefing in Monte Carlo.

10.09.2018

See all