Aside from catastrophe-exposed properties, plentiful capacity and muted demand have resulted in rates moving in a narrow range for companies renewing their reinsurance at the start of the year.

There also have been few changes in terms and conditions, experts say.

David Flandro, New York-based global head of business intelligence for Guy Carpenter & Co. L.L.C., said higher reinsurance rates have been limited to property/casualty accounts directly affected by catastrophe losses last year, especially those in the path of Superstorm Sandy.

“By and large, the vast majority of non-loss-affected rate movements around the world were between” a drop of 5% and an increase of 5%, Mr. Flandro said. “It was a really straightforward year for rates.”

The mitigating factor keeping a lid on rates is the record amount of capacity in the sector, according to Aon Benfield's latest report, “Reinsurance Market Outlook, January 2013.”

“There's a significant amount of capacity in the market now,” said William Donnell, New York-based president of U.S. property/ casualty for Swiss Re Ltd. “You can't ignore supply/demand dynamics.”

Bryon Ehrhart, Chicago-based chairman of Aon Benfield Analytics and Aon Benfield Securities, noted that aggregate reinsurer capital grew by more than 10% in 2012 (see chart), limiting individual reinsurers' ability to pass on higher rates.

“The growth of supply is significant. We are now at a half-trillion dollars of capital,” Mr. Ehrhart said. “Meanwhile, the growth in demand was essentially flat to down, so we expect to find a very competitive market for reinsurance in 2013.”

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This lack of growth is largely attributable to the economic malaise in the developed market, said James Vickers, London-based Chairman of Willis Re International.

“The real underlying issue is that there is little growth in Western mature markets,” Mr. Vickers said. “Another big conundrum for reinsurers is what to do with their capital” given persistent low interest rates.

Meanwhile, prior-year reserve releases that have buoyed reinsurers' balance sheets in recent years are ebbing, Mr. Flandro said. “Net aggregate reserve releases should persist in the very near term, but likely not in the quantity they have in the last six years,” he said.

“The impact of low interest rates has been that reinsurers have placed a larger emphasis on the need for underwriting profit” in selecting the risks to underwrite, Mr. Donnell said.

Mr. Vickers said a stronger focus on underwriting is needed given the recent spate of catastrophe losses that exceeded modeled estimates as well as risks that have not been modeled.

James Few, CEO of Aspen Re, a unit of Hamilton, Bermuda-based Aspen Insurance Holdings Ltd., said the reinsurance industry is improving the way it utilizes catastrophe modeling.

“The industry is adjusting to lessons learned following the 2010-2012 cat events, notably in relation to new insured values in cat-exposed regions of the world, modeling and data calibration around earthquake and flood, and increasing concerns about our ever-changing climate patterns,” Mr. Few said during an analyst call earlier this month.

Elsewhere, Mr. Vickers sees a new commitment to product development from reinsurers in the wake of shifting demands for primary insurers, which are seeking more bundled coverage. “Ceding companies are becoming much more sophisticated in the way they buy reinsurance,” he said.