Reinsurance pricing remains under pressure despite hints of stabilisation at the January renewals, according to industry players.

Unless the capital pool shrinks substantially, rates will likely remain at current levels or fall further.

However, reinsurers are mostly satisfied with the crucial January renewals, which are often seen as a guide to the year ahead, although few expect rates to climb soon.

“The value proposition of reinsurance improved further and insurance companies continued to incorporate reinsurance capital with modestly better pricing, terms and conditions into their underwriting capital structures at January 1,” Aon Benfield Head of Broking John Carroll told insuranceNEWS.com.au.

“While the above market position is a positive for insurers, which will benefit from the reduced cost of reinsurance capital, insurers locally and globally are faced with a similar supply/demand imbalance, which is translating into similar pressure on original rates.

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