Reinsurance market stabilises amid mid-year renewals

Property catastrophe reinsurance rates were generally flat to slightly down.

The mid-year renewals showed the reinsurance market meeting heightened demand. Loss-free property programs generally saw price easing despite increased demand, whilst casualty programmes maintained sufficient capacity amid ongoing pricing scrutiny due to market shifts, Guy Carpenter reported.

“Well-positioned cedents achieved greater concurrency and pricing consideration in this positive but still cautious trading environment,” said Dean Klisura, President and CEO of Guy Carpenter. “However, headwinds, including unsettled macroeconomic conditions and the geopolitical environment, are leading to shifting risk appetites,”

The preliminary mid-year US Property Catastrophe Rate on Line (ROL) Index by Guy Carpenter shows minimal change year-on-year, reflecting stable market conditions. Property catastrophe reinsurance rates were generally flat to slightly down, with some upper layers seeing reductions of 10% or more for non-loss-impacted accounts.

Casualty renewals varied across sublines, with general liability and excess/umbrella programs facing pricing pressure, while cyber reinsurance terms improved across all structures. Catastrophe bonds saw record activity in the second quarter, totalling $11.9b in limits placed for the year.

Retrocession market dynamics showed increased demand in Q2, driven by improved purchasing dynamics and active forecasts for the North Atlantic wind season. 

David Priebe, Chairman of Guy Carpenter, highlighted the industry's robust response to heightened 2024 demand, driven by improved returns and capital positions.