Beazley's Group Head of Treaty Patrick Hartigan discusses the property reinsurance market and renewals expectations
In a printed interview available here with Beazley's Group Head of Treaty, Patrick Hartigan describes the forthcoming January and July renewal seasons as "crucial" in order to align reinsurers' rates with those in the underlying insurance market and for taking on board the issues of climate change and climate variability.
"The expectation is over the next eight months reinsurers will make a concerted effort to shift the basis on which they price most perils in most territories. The main focus, however, will be perils such as wildfires and floods, which at the moment the market classes as secondary perils."
Patrick says "A critical mass of reinsurers – from some of the biggest players in the market to individual Lloyd’s syndicates – are now ready to act on those findings. The market will assess and rate these perils based on real-time (rather than historical) data: a radical approach to underwriting that is “forward-rather than backward-looking”.
He predicts average "baseline reinsurance rate increase[s] towards 15% to 20% with some companies such as European insurers being subjected to a 50%-plus increase.
We recommend the article for both Patrick's description and analysis of the reinsurance market and also its portrayal of Beazley's reinsurance division with its focus on underwriting profitably for investors.