The catastrophe reinsurance market has seen “material interest” from insurers, according to a mid-year update from broker Guy Carpenter.

About $US35-$US40 billion ($53-$61 billion) of additional catastrophe limit was bought in the seven months to July, it says.

More than 50% of increased limit originated in North America, across a range of companies.

Guy Carpenter says reinsurers’ profitability improved going into this year, incentivising them to utilise increased capital in property catastrophe.

“By the start of 2024, a healthier balance had returned to the global property catastrophe market. Reinsurers’ recovering profitability, coupled with additional available capital, created favourable conditions for cedents to evaluate additional property catastrophe limit purchases.

“Across geographies, demand significantly increased, and reinsurers met this growing demand, placing the sector largely in equilibrium.”

Guy Carpenter says as the year started, significant corrections in pricing and attachment points drove a return to profitability in the property reinsurance market.

Another trend has been the “material interest” in more catastrophe protection from reinsurance buyers.

“With minimal movement in net limits purchased over the past couple of years during more difficult market conditions, there was material interest in additional limit coming into 2024,” the reinsurance broker’s market update said. “Significant inflationary pressure grew underlying valuations and, therefore, cedents’ exposures to loss.

“Greater market stability, and moderating pricing in a number of segments, provided cedents with better ability to budget for additional levels of coverage.”