According to the most recent “Bermuda Quarterly Report” from global reinsurance broker Benfield’s Industry Analysis and Research team, Bermuda reinsurers have forecast that rates will continue to harden through the year and could even spread into other territories in 2007, as “increased demand, revised catastrophe models and more stringent capital constraints continue to squeeze capacity.”
The 18-page report observed that total net income for Bermuda’s 16 leading reinsurers was up 21 percent over from the first quarter of 2005 to $2.3 billion. At the same time Benfield notes, premium income “decreased 5 percent to $16.5 billion, the first decrease in 1Q premium volume since 2001. The weighted average combined ratio decreased from 91.6 percent to 89.2 percent.”
“These top line reductions are attributable to more disciplined underwriting, reduced capacity due to stricter capital requirements by rating agencies, and the transfer of business to sidecars,” noted Christopher Klein of Benfield’s Industry Analysis and Research team.
Benfield, a leading independent reinsurance and risk intermediary, compiles and shares information on Bermuda’s 16 leading reinsurers on a quarterly basis. A full copy of the report can be viewed online at www.benfieldgroup.com/research. Printed copies can be obtained by contacting IAR@benfieldgroup.com.
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