Willis Re 1st View January 2020: Markets Diverge
Posted 14/01/2020 – Insights
Willis Re has released the January edition of its thrice-annual update of global reinsurance market conditions.
- Reinsurers have been judicious during the 1.1 renewal period, leading to significant pricing and capacity variance depending on geography, product line, loss record and individual client relationships.
- US placements were more challenging than international renewals, with UK motor and some international liability accounts being the exceptions to the rule, while property catastrophe (cat) proved less demanding than non-cat business.
- Renewal negotiations were particularly demanding on liability accounts showing prior-year loss development and on risk programs with increased loss frequency and/or severity.
- Pro rata liability renewals were less volatile than excess of loss renewals, mainly as a result of primary pricing trends continuing to move upward in a growing number of classes and territories, with the increase in primary pricing accelerating in the second half of 2019.
Capacity for retrocessional covers has been in shorter supply after Insurance-Linked Securities (ILS) capacity growth stalled in the past 12 months and in some cases reduced, leading to significant rate increases and program restructuring particularly for aggregate placements.
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