The influx of third-party capital to the reinsurance market will bring major benefits for mutual insurers, according to Willis Re.

Executive VP Robin Swindell says mutuals often rely on reinsurance for extra capital to deal with large losses, and the abundance of capital has created favourable buying conditions.

“The cost of property catastrophe reinsurance is falling and well-managed renewal negotiations have the potential to make this an immediate and easily quantifiable benefit.

“Increasing competition among reinsurers also provides incentives for them to be more flexible about contract conditions.”

There is a wide range of reinsurance providers, making it easier to find partners that recognise and give credit for mutuals’ unique characteristics, Mr Swindell says.

“As the January 1 renewal season approaches, we will certainly be pointing out to our mutual clients that now is the time to try to benefit from these changes, and reminding reinsurers they should consider and treat mutuals as preferred customers.”

The influx of capital, sparked by low interest rates and moves to diversify investment portfolios, was a recurring theme at the Reinsurance Rendezvous in Monte Carlo earlier this month.