There's no reason for reinsurance buyers to beware.

With only a couple of exceptions, prices are falling for virtually everything from property catastrophe reinsurance to casualty treaty coverage, with reinsurers also yielding ground on other terms and conditions.

Many covers are renewing late as buyers hold out to the last moment for the lowest possible price, reinsurance brokers report.

"The market is a lot softer. If there's something that particularly irks you (in a program), you can change it. (Reinsurers) are getting very adaptable," said Steven Bolland, senior vp with reinsurance intermediary Gill & Roeser Inc. in New York.

"There is just no resistance on the part of reinsurers at all," said another intermediary who asked not to be identified. "Some things are just irresponsible."

The catastrophe market has softened rapidly as the hurricane season has drawn to a close.

Pricing has remained relatively firm for large ceding insurers that require big limits from worldwide markets, as well as for insurers suffering big losses, brokers and reinsurers say. Otherwise, prices are falling, with U.S. regional insurers and European ceding companies seeing reductions ranging from 10% to 50%.

"I have not seen a single contract, other than those that suffered large losses in the Caribbean, that has renewed at the same price for the same cover," said Paul Ingrey, president of F&G Re Inc. in Morristown, N.J.

Rates for national insurers were down 10%, while regional reinsurers had reductions of 15% or more and international insurers received average decreases of around 15%, he said.

And those insurers that suffered losses are still only receiving single-digit increases, he said.

Some large national insurers are getting 10% to 15% reductions, while regional companies that require less than $100 million in capacity may see reductions of between 20% and 40%, said Edmund Megna Jr., managing director with intermediary Guy Carpenter & Co. Inc. in New York.

The competition "reminds me of what I saw in the early 1980s," Mr. Megna said, the key differences being that today's market consists of a more sophisticated pool of buyers and sellers and a vastly smaller number of reinsurers offering much larger lines.

Worldwide catastrophe capacity is back in a big way and is one of the forces driving the rate reductions.

National ceding insurers can easily get $300 million to $350 million in catastrophe limits, and this could increase to more than $500 million for a program that is broken into regional segments, Mr. Megna said.

Even with the rate reductions, reinsurers are still able to generate adequate profits, Mr. Ingrey said.

"When you have a worldwide spread of catastrophe business you can absorb another Hurricane Andrew and still make an underwriting profit," he said.

Catastrophe rates still accurately reflect the exposures, agreed Jean-Pierre Fillebeen, vice chairman and chief executive officer of SAFR Reinsurance Corp. of the U.S. in New York.

"We use our modeling system, and although there is some softening in the catastrophe programs, the price is still correct," Mr. Fillebeen said.

Bermuda reinsurers looking for a worldwide spread of risk have focused on writing programs for non-U.S. insurers and U.S. regional companies and have shown less interest in large U.S. national accounts, brokerage sources say.

Michael A. Butt, chairman and CEO of Mid Ocean Reinsurance Co. Ltd. in Bermuda, reported that rate reductions on U.S. business were moderate and that there were some increases for insurers that had large losses.

Outside the United States, there is greater pressure on rates, he said.

"Competition in Canada is very aggressive. There is much too much capacity....The local companies of the international groups are all madly defending their turf," he said.

In Britain, rates are decreasing by between 10% and 12.5%, Mr. Butt said.

However, rates in Britain increased substantially more than rates for U.S. insurers between 1991 and 1993, he said.

In Germany, competition between reinsurers has heated up as the local companies try to guard their business in a market in which both Employers Reinsurance Corp. and General Reinsurance Corp. substantially increased their holdings in the past year, Mr. Butt said.

And Latin American rates have fallen as more reinsurers try to diversify their portfolios and seek additional business outside of the major markets, he said.

Meanwhile, catastrophe reinsurers are offering other concessions besides rate reductions.

The so-called "hours" clause-typically defining an event as occurring within a 72-hour period-is being expanded in some cases, according to Mr. Megna.

This means that a ceding insurer might not have to absorb more than one retention for an event lasting longer than 72 hours.

Continuing a trend of the last year or more, reinsurers are also allowing ceding insurers to pay what amounts to a reduced up-front rate for a reinstatement of limits, rather than waiting until after the limits are exhausted to reinstate them, brokers say.

In another development, Mr. Megna noted that some retrocessional protection is becoming available to catastrophe reinsurers after a period in which the retro market virtually dried up.

The coverage is being offered in some cases by insurers rather than reinsurers, and there is no softness in pricing or other conditions, he said.

"We are not back to the LMX days at Lloyd's," Mr. Megna said, referring to the London market excess-of-loss spiral of the late 1980s. "But there is some retro capacity, and it's growing."

The market for other property and casualty reinsurance covers, meanwhile, remains in the soft state it's been in for several renewal periods, most brokers and reinsurers say.

Pricing for working-layer property covers depends largely on loss experience, while the market for upper layers is generally competitive, except where worldwide capacity is needed, Mr. Megna said. Small commercial property programs are having the easiest time, he noted.

"Unless you've had losses, it's just going to be easing off some," Gill & Roeser's Mr. Bolland said of this season's modest property rate reductions.

Non-catastrophe property rates are flat or a fraction lower, reflecting fewer losses for reinsurers, agreed John Lombardo, president and CEO of Munich American Reinsurance Co. in New York.

"They were already down as low as they could get, so there weren't any more decreases," he said.

Casualty renewals are also proving easy work for most ceding companies.

Clash covers, triggered when two or more casualty policies are involved in a single occurrence, are seeing rate reductions of 10% to 15%, liberalized reinstatement provisions and other loosening of insuring conditions, according to Mr. Megna.

"It's very similar to what's going on on the property side," he said.

"There's definitely more capacity," he added, estimating that $50 million to $60 million in clash limits are available.

The casualty treaty market is flat to competitive, market sources report.

"It's extremely, extremely soft," said Salvatore D. Zaffino, president of Sedgwick Payne Co./Crump Re in Hartford, Conn., adding that he has seen rate reductions from 10% to 25% off last year's reduced rates.

An intermediary who did not want to be identified said some casualty business is being renewed at "burning cost"-pure loss cost-or less, a development he labeled "irresponsible."

However, Richard Cole, chairman and CEO of Chartwell Reinsurance Co. in Stamford, Conn., said the casualty reinsurance market seems to have "bottomed out."

"Most of our casualty business has renewed as is," and rates have increased for some business with poor claims experience, Mr. Cole said.

"In the past couple of years you would lose the business to competitors if you tried to increase the rates, even if it was bad business," he said.

Casualty reinsurance rates should continue to hold up, he added.

"Other forces will affect it. There will be more consolidations and that will take some more players out of the market and the deterioration of known loss reserves will make the market realize that it can't go down any further," he said.

Nevertheless, several observers say there are no signs of tightening in most areas of the market.

"I don't see any companies saying, 'The market is stupid, we're going to walk away,'*" Mr. Bolland observed. "Anything is negotiable."

Even niches within the property/casualty reinsurance market like surety or ocean marine have given way to competitive pressure, he added.

"The herds have discovered the niches at the same time," Mr. Bolland said.

Despite the abundance of willing capacity for most programs, many renewals-particularly property cat programs-are running late as buyers hold out for the best price, several observers say.

"Buyers of catastrophe reinsurance probably felt that prices would go down and the later they got in to the market, the better they would do," Mr. Ingrey said.

"When everything is soft, you always hope the next quote to come in is the best," Mr. Bolland said. "This is a good year to be late."

"It's probably very irritating for the underwriters," he added, "because they were sitting around early in the year and now they're swamped."