Reinsurance Market Stabilizes Amid Rising Global Capacity

2

The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.

"The current scenario represents a well-balanced alignment of demand and supply, with reinsurers showing increased willingness to commit their extensive capital," noted Tom Wakefield, CEO of Gallagher Re.

Across the Australasian region, the market exhibited less fluctuation in property catastrophe quotes compared to last year, indicative of achieving sustainable long-term pricing. According to Gallagher Re, prices remained relatively stable with select cases experiencing risk-adjusted reductions on higher layers.

The latest statistics reveal Australian catastrophe reinsurance rates for properties without previous losses fell between 0-10%, whereas those hit by losses saw increases of 5-10%. Casualty sectors, meanwhile, displayed steadiness, backed by robust perceived price appropriateness.

Tony Gallagher, CEO of Guy Carpenter Asia-Pacific, highlighted a 4% rise in regional demand against a 10% surge in supply, resulting in a softening of market dynamics. "In Asia-Pacific, first-half renewals smoothly transitioned with rate reductions noted in non-loss-impacted programs," he explained. "We also observed a stabilization of terms, conditions, and structures, with minor modifications driven by policyholders."

Guy Carpenter’s analysis corroborates that most property placements were finalized early or on schedule in an evolving market context. Global property catastrophe rates, when adjusted for risk, displayed flat to modest declines mid to high single digits; particularly in upper layers, some instances fell over 10% for non-loss-impacted profiles, suggesting a "moderating yet robust" pricing sphere.

Reflecting on prior challenges, Aon emphasized that the recent renewal season in Australia and New Zealand saw a return to stability. Comparatively low natural disaster losses over the preceding year set the stage for outcomes characterized by predictability, with reinsurers actively showing interest in regional catastrophe risks.

Significant insured loss events, such as the Christmas and New Year storms and Cyclone Jasper, primarily impacted insurers due to higher net retentions from last year’s renewals, leading to more conservative losses for reinsurers.

"While there is increasing support for lower-layer placements, reliance on traditional aggregate reinsurance remains limited," observed Aon. "Nonetheless, discussions regarding alternative solutions have gained momentum."

A notable development, the cyclone reinsurance pool, swayed demand by reducing property catastrophe reinsurance needs by roughly $3-$4 billion last year. Large insurers had integrated the pool by December end, with smaller insurers expected to follow suit by year-end.

Aon concluded, "The integration of the cyclone pool into catastrophic programs reflects a mature understanding and acceptance within the market."

Published:Thursday, 4th Jul 2024
Source: Paige Estritori

Please Note: If this information affects you, seek advice from a licensed professional.

Share this news item:

Insurance News

Clear

Allianz Partners Highlights the Risks of Travelling Uninsured

14 Dec 2025: Paige Estritori

Recent research commissioned by the Insurance Council of Australia (ICA) and the Department of Foreign Affairs and Trade's (DFAT) Smartraveller program has unveiled a concerning trend: approximately 14% of Australian travellers embark on international journeys without any form of travel insurance. This statistic has prompted Allianz Partners to urge Australians to reconsider the importance of securing adequate coverage before travelling abroad. - read more

Surge in Medical Claims Among Australian Travellers Highlights Importance of Comprehensive Insurance

14 Dec 2025: Paige Estritori

In 2024, medical incidents emerged as the leading cause of travel insurance claims among Australian travellers, accounting for more than 40% of all claims handled by nib Travel. This trend underscores the critical importance of securing comprehensive travel insurance to mitigate the financial risks associated with medical emergencies abroad. - read more

Rising Travel Insurance Claims Among Australians Visiting Bali

14 Dec 2025: Paige Estritori

The allure of Bali continues to captivate Australian travellers, with a notable 43% increase in travel insurance policies purchased for the destination since the 2022/23 summer season. This surge has corresponded with a 50% rise in related insurance claims, now accounting for 16% of all claims submitted to Southern Cross Travel Insurance (SCTI) in 2024. - read more

Unveiling Hidden Exclusions in Travel Insurance Policies

12 Nov 2025: Paige Estritori

Australian travellers are being urged to carefully review their travel insurance policies to identify potential exclusions that could affect their coverage. Legal expert Peter Carter from Carter Capner Law highlights that certain activities, such as riding motorbikes or jet skis and consuming alcohol, are often classified as high-risk by insurers. Incidents occurring during these activities may lead to claim rejections. - read more

Qantas Travel Insurance Honoured with Mozo Experts Choice Award 2024

04 Nov 2025: Paige Estritori

Qantas Travel Insurance has been recognised in the 2024 Mozo Experts Choice Awards for Travel Insurance, showcasing its exceptional value for their Annual Multi Trip Travel Insurance policy. - read more

Click for more Insurance News