A new report from A.M. Best determined that “stocks for publicly traded reinsurance companies, including the four top European players, performed below the overall market for the first quarter of 2014, declining 1.3 percent, likely due to continued concerns over the decline in pricing for reinsurance risk.
The special report – “Global Reinsurer Stocks Face Challenges in 2014,” – states that “pricing pressures for catastrophe business continued during the Jan. 1 and April 1 renewals. Declines of as much as 20 percent (more pronounced in the United States) have been attributed to the absence of market-changing losses, as well as increased retentions carried by ceding companies.
“Some management teams have indicated that the inflow of capital from the insurance-linked securities (ILS) market led to lower rates in U.S. catastrophe business.”
Source: A.M. Best