The reinsurance industry found itself in a “disciplined soft market” in the mid-year renewals, broker Willis Re said in its latest 1st View report.
It said this was evidenced by the fact reinsurance buyers had to change their panels of counterparties if they wanted to push pricing down as far as possible, often having to rely on lower-rated capacity in order to do so.
Meanwhile, Willis Re global CEO James Kent noted that traditional reinsurers remain under intense pressure to revise their operating models, with various carriers considering significant job cuts and withdrawals from underwriting in certain segments.
“This year is the straw that’s broken the camel’s back,” he told Trading Risk.
Diversifying but marginally profitable lines of business are no longer acceptable to carriers, he added.
Kent said that cutbacks would undoubtedly be painful for the industry but should ultimately prove beneficial.
To continue reading, click here.