It’s a buyer’s market in the Asia-Pacific region, with reinsurance capacity outweighing demand, according to a new report from Guy Carpenter.

The reinsurance broker’s Asia-Pacific Catastrophe Report says local buyers are increasing protection levels, with the regional catastrophe limit increasing 10% this year.

Conversely, the regional rate-on-line index is down 9.9%, the report says.

Guy Carpenter predicts the current underwriting year will mirror last year and 2013, by returning a regional catastrophe loss ratio below 20%.

This is despite continued depreciation of some key-zone currencies against the US dollar, the recent port explosions in Tianjin, China, and the deterioration of prior-year losses from New Zealand and Japan.

Guy Carpenter says outstanding 144A catastrophe bonds increased 22% since September last year, in addition to the completion of Panda Re – the first cat bond benefitting a Chinese insurer or reinsurer.

Appetite for primary catastrophe premium from alternative capital providers remains high in the Asia-Pacific region, where it is believed to form almost 6% of the regional catastrophe limit.

Guy Carpenter Asia-Pacific CEO James Nash says given the healthy catastrophe loss ratio it is “unsurprising” to see new and old capital offering buyers a choice of products and selection of counterparties with which to transfer catastrophe risk.