Elevated natural catastrophe risks, macroeconomic instability and a politically charged environment are adding to demand for reinsurance solutions, according to Swiss Re.

The reinsurer made the assessment at the Rendez-Vous de Septembre in Monte Carlo last week.

“Swiss Re sees increasing demand for reinsurance in a volatile environment,” it said. “Beyond risk transfer, insurers are turning to reinsurers for value-adding insights and solutions that can help them better understand and mitigate risk, unlock innovation and improve performance.”

Property and casualty reinsurance CEO Urs Baertschi said the key issues for the industry were largely unchanged from last year’s gathering in Monte Carlo.

“But the challenges have intensified, leading to higher demand,” he said. “Faced with elevated natural catastrophe risks, economic uncertainty and geopolitical instability, reinsurance is the natural way for insurers to protect themselves from outsized losses.”

Swiss Re says higher property values, urbanisation and inflated repair costs are expected to drive demand for property (re)insurance, especially in areas with intensifying natural catastrophe risks.

Demand in engineering, especially for renewable energy projects, is also picking up.

Swiss Re says as perils arise or intensify, accurate and timely data is essential to recalibrate models and create scenarios that enable risk-adequate pricing.

“Modelling expertise to stay on top of the changing risk landscape, up-to-date assessments and management of exposures are becoming even more essential.”