S&P Global: 2017/18 - A stable perspective on the reinsurance market

6 April 2017 — Oleg DORONCEANU, Vlad BOLDIJAR
Dennis_SUGRUEThe credit conditions remain weak and the reinsurance companies will keep on fighting to generate past years' revenues, according to a statement made in Moscow, by Dennis SUGRUE, Senior Director, EMEA Region, S&P Global Ratings.

"The request and the offer will keep having a significant impact on prices. The pricing war will continue to put pressure on the industry revenues in 2017-2018. We're not expecting for investments to generate past years revenues," he said at the XXIst edition of during the Annual Reinsurance Conference.

"Overall, the perspective on the reinsurance market is a stable one, with players generally responding to all challenges, with defensive and timely measures."

Referring to a short time foresight, the S&P representative considers that, in the next two years (2017-2018), the revenues from low investments will influence the reinsurance market, meanwhile the expenditure and the combined ratio will keep on growing.

Also, the pressure on profitability will be the same: "For 2017-2018, we're expecting that the operational profitability of the industry will follow a low trend. Also, the pricing war is going to alter, at an aggregate level, premium values. The combined ratio is estimated at 97%-102% for 2017 and 100%-104% for 2018. The Return On Equity (ROE) forecast is 6%-8% for 2017-2018."

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