Willis Group Holdings has released its annual reinsurance renewals report for January 2008 with the rather ominous subtitle “Settling or Sinking?” The report highlights “one of the major trends witnessed in this year’s renewals” – a rapidly softening market.
As Guy Carpenter also observed (See related article), the 2008 renewal season has emerged as “one of almost unprecedented lateness, as insurers try to reconcile reinsurer offerings with their own financial objectives,” said Willis. The global broker also found signs that the industry is “reverting to the historic pattern of feast or famine.”
Willis’ report focuses on rate movements across numerous territories and includes detailed analysis from its product line experts. Key findings of the report include:
— Rate reductions in almost every line of business
— Record profits and the quest for diversification has led to severe competition amongst reinsurers
— The sub-prime crisis has had a limited effect on reinsurers’ appetite
— Capital markets interest in supporting insurance risks remains unabated, with some $6.4 billion of cat bonds being issued this year
Willis Re CEO Peter Hearn commented: “Our clients are confronted by an array of challenges in every country and line of business and we hope this report will help them to formulate a more comprehensive picture of the key issues facing the market this renewal season and in looking forward to the rest of 2008.”
For the full report go to: http://www.willis.com/news/Publications/Willis_Re_View_January_2008.pdf
Source: Willis Group Holdings – www.willis.com.