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Primary rates stabilising: Guy Carpenter

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Guy Carpenter Global Head of Distribution Lara Mowery has given a peek at what to expect ahead of the January renewals season.

She told a virtual media briefing last week that primary rates are stabilising and ample traditional as well as alternative capital are bolstering the sector.

“Some drivers of uncertainty are dissipating,” Ms Mowery said. “Reinsurers’ risk appetites and product offerings continue to evolve in response to emerging market realities, and differentiation remains valuable.”

She says mid-year placements indicate moderating increases in average pricing due to the strong capital position of the sector and general economic rebound.

“The market will continue to monitor how COVID-19 claims are resolved and how the losses of 2021 develop while also turning attention to evolving risks including cyber and climate change,” Ms Mowery said.

The briefing hosted by Guy Carpenter also included the views of other industry participants.

Guy Carpenter MD and Head of London Europe Sebastian Cook says the US Property Catastrophe Rate-on-Line Index increased by 6% for renewals from January through July, approximately half of the increase experienced over the same period last year.

In Asia the increase was about 5%.

“Overall [Rate-on-Line] levels were impacted by several factors, including some upward shifts in retentions, particularly on loss-impacted programs, additional limits purchased on the top end of programs and increased pricing,” Mr Cook said.

“More broadly, the concerns about exposure from secondary perils and climate change were offset by abundant capacity, the effect of compounding rate increases and strong appetite for growth.”