No hard market in sight: Reinsurers' meetingPosted On: Oct. 26, 2009 12:00 AM CST
BADEN BADEN, Germany—Reinsurers’ hopes for a hard market have faded as year-end renewals progress and most prices are flat or rising slightly except natural catastrophe exposures, say participants at an annual gathering in Baden Baden, Germany.
Reinsurers’ outlooks have changed since last month’s meeting at the Rendez-Vous de Septembre in Monte Carlo, Monaco, said Henry Keeling, London-based president and chief executive officer of Guy Carpenter & Co. L.L.C.’s international operations.
“At Monte Carlo, many observers, Guy Carpenter included, would have said that we expected an orderly renewal season and, absent any major events, generally level pricing,” Mr. Keeling said Sunday during the Baden Baden Reinsurance Symposium sponsored by Guy Carpenter. “Just a few weeks later, I believe sentiment is more bearish and a downward bias seems generally to be expected.”
Reinsurance prices will rise in some cases, particularly for natural catastrophe exposures, but a general market hardening is not expected, reinsurers and brokers in Baden Baden said.
SCOR S.E. will increase prices on some business, depending on the line of coverage and the client, said Victor Peignet, CEO of property/casualty business at SCOR in Paris. He did not say how much SCOR plans to increase prices, but said a “reasonable increase” would be sought on some accounts.
Munich Reinsurance Co. is taking much the same approach, said Ludger Arnoldussen, a member of the Munich, Germany-based reinsurer’s board of management responsible for business in Germany, the Asia Pacific region and Africa.
“Where we expect to see prices moving upward are in markets or lines of business where we’ve seen significant claims experience, and capital-intensive business” such as natural catastrophe accounts. Mr. Arnoldussen said.
Swiss Reinsurance Co. signaled in a Friday conference call before the Baden Baden meeting began that it expects natural catastrophe rates to continue firming throughout the renewal season.