Guy Carpenter report on 2024 renewals

The global insurance broker Guy Carpenter issued a press release available here with interesting and positive information on the recent renewals at year-end 2023.

In essence, the renewal negotiations between underwriters and brokers at this recent year-end were conducted in a much more orderly manner with none of last year's stresses and capacity shortages, and importantly, in these recent renewals, last year's market significant "reset" in reinsurers' favour was not reversed.

As a reminder during 2022, against a background of record-breaking Hurricane Ian and reduced capital, reinsurance renewal negotiations were often difficult and prices for the tightly-available capacity moved up considerably. For last year's article on the December 2022 renewal season click here.

The 2023 year saw an increase in reinsurers' capital thanks to the unwinding of some of the investment losses (on paper) which in combination with their success in avoiding the majority of the severity and frequency of the industry's losses of 2023, meant that they were more inclined to renew programs at similar terms as last year's.

Reinsurers also maintained their much higher attachment points and narrower policy terms and conditions which proved incredibly valuable in avoiding much of the US$100bn of industry losses of 2023.

Guy Carpenter's report mentions that non loss-impacted programs were renewed at flat to single digit increases. Loss-impacted programs experienced +10% to as much as +30% rates.

Hampden Underwriting Research will provide a 2024 market report in due course commenting on the year-end renewals and will also provide information at our Spring Roadshows. Further articles will follow here in due course.

It does look as if the paradigm shift that took place last year-end has continued and the widespread reassessment of the correct price for risk - which has stood the market in good stead for 2023 - has been maintained. This augurs well for reinsurers' results.