Reinsurance market growth has continued despite cat impact

Global reinsurance capital reached $605bn in the fourth quarter of 2017, a 2% increase over the same period in 2016 new figures data from Aon Benfield's latest Reinsurance Market Outlook shows. The semi-annual reinsurance market survey also revealed that traditional capital saw a $2bn year on year increase to $516bn, while alternative capital rose by $8bn reaching $89bn. The 21 companies that make up the Aon Benfield Aggregates (ABA) generated $249bn of gross premiums written in 2017, of which $174bn comprised property and casualty business. There was an 8% increase in primary insurance gross premiums written to $89bn while assumed reinsurance rose 5% year on year to $85bn. P&C net premiums earned increased by 6% year on year to $144bn, stated the report. Alternative capital also saw strong growth in the first half of 2017 which coincided with record volumes of catastrophe bond issuance. However, losses seen from the second quarter of 2017 as a result of natural disasters reached $15bn in retrocession and another $5bn in trapped collateral. However, most of the capital trapped has been replaced, stated the report, adding that the prospect of new returns in the territories affected attracted new participants. The report also revealed that the catastrophe bond market saw a strong first quarter in 2018, continuing the momentum seen in 2017. “We expect to see further growth in the alternative capital market during 2018,” read the report. The ABA constituents include Alleghany, Arch, Argo, Aspen, AXIS, Beazley, Everest Re, Fairfax, Hannover Re, Hiscox, Lancashire, MAPFRE, Markel, Munich Re, Partner Re, QBE, RenRe, SCOR, Swiss Re, Validus and XL Catlin.

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