Reinsurance broker Aon Benfield says “meaningful rate changes” experienced for recent reinsurance renewals in loss-affected areas like Australia and New Zealand were not matched in other parts of the world.

In its June/July Reinsurance Renewals Update report examining its clients’ experiences at the June 1 and July 1 reinsurance renewals periods, the broker says most renewal rates were flat to 5% down, compared to reported price increases of up to 15% by other brokers.

In New Zealand, “despite some predictions of capacity shortages, especially with respect to earthquake cover around Christchurch, this did not eventuate”.

But the report adds that “significant” pricing and capacity pressure was felt at the lower layers of catastrophe programs.

“NZ renewals pricing at June 1 increased more than 100% due to the large and still uncertain losses from the series of events in Christchurch,” the report says. “The ongoing seismic activity was also a source of concern for reinsurers.”

In Australia, the report found that reinsurance price increases at July 1 of between 15% and 70% were experienced.

“Significant pressure was applied to retention levels, pricing on loss-affected layers and minimum rates on line charged on upper layers. Pressure was also applied to reinstatement conditions.

“Notwithstanding these pressures, ample capacity remains available for Australian programs.”

Some Japanese insurers that extended their April 1 programs by three months also renewed at July 1, with increases ranging from 30% to 50%, the report says.

But the other main programs to renew – hurricane-prone Florida at June 1 and US national insurers at July 1 – both renewed at rates that were flat to 5% down.

While rate increases were felt in regions directly affected by the catastrophes, Aon Benfield Analytics Chairman Bryon Ehrhart says there is a “real debate” as to whether unaffected regions should pay more for their catastrophe capacity following such loss activity.

The company forecasts that US property catastrophe renewals should be flat to down 5% due to “the absence of a market-changing catastrophe event”.