Supply dynamics and attachment points remain stable at mid-year, as we look ahead to conference season
Renewals at the start of the year saw a market reset after some instability in 2023. Have favourable supply dynamics resulted in more stable renewals in 2024?
The supply of reinsurance capacity through the January 2024 renewals was stable following the turbulent conditions around the 2023 renewal season.
Attachment points, which had increased significantly last year, generally remained unchanged; crucially we didn’t see a lowering of these attachment points. And whilst rates may have flattened through the early months of 2024, the market, on the whole, has remained disciplined, not least aided by the deterioration in 2023 losses, for example Italian Hail, Storm Denis and Hurricane Otis.
Additional capacity which has become available in 2024 has come via an increased appetite of existing markets rather than from an entrance of new capacity.
For QBE Re, the correction in market conditions over the past 12 months has assisted our ability to build a resilient portfolio where we are offering sustainable, long term partnerships to key clients.
How would you describe the market response to the 1.4 reinsurance renewal? And have the 1.4 reinsurance renewals differed from those set at 1.1?
The main attention for the April renewals is Japan.
The Property market was fairly unchanged from the January renewals with continued reinsurer discipline although there were signs of increased reinsurer appetite.
For Casualty, the primary focus was on US and PFAS exposures. Whilst the original market is taking corrective action in their underlying exposures, reinsurer appetite was more limited than it has been in recent years. Positive rate change to reflect these exposures was also pushed through.
What will conference season conversations bring in 2024?
It’s still quite early to call the main conference themes for 2024. That said, the increased frequency of secondary perils, such as the recent Dubai floods, will undoubtedly be a feature of conversations as well as the loss creep from prior year losses, as mentioned above.
Back year movement on Casualty reserves will also likely continue to be a topic for discussions as will more recent events, such as the Baltimore bridge collapse which has had a major impact on the Specialty market. Other subject matters will probably include the ongoing global geopolitical uncertainty, whether that be in Russia/Ukraine, the Middle East or, potentially, China/Taiwan.
And the message from QBE Re will be to reinforce our commitment to stable long term partnerships with global and key clients as we look to consolidate our portfolio which is resilient to events as and when they occur.
