The reinsurance broker’s leadership describes market conditions expected to influence placement discussions ahead of 1 January 2025 renewals.

The reinsurance market is characterised by reinsurers’ strong profitability in 2024 and growing capitalisation, expected to continue into 2025, according to Guy Carpenter.

GC Dean Klisura Headshot

Dedicated reinsurance capital is will rise to $620bn in 2024, a 9% increase, the reinsurance broker and rating agency AM Best jointly project.

Catastrophe bonds had a record first half of the year, with the second quarter being “the most active quarter recorded to date”, Guy Carpenter said.

By June 30, some 51 different catastrophe bonds had been brought to the 144A market for approximately $12.2bn in limit placed, taking the total outstanding notional amount to more than $45.2bn.

President and CEO of Guy Carpenter, Dean Klisura (pictured), said: “The market has ample capacity and reinsurers are motivated to engage with cedents.

“Our clients are seeking to differentiate themselves in this marketplace and leverage key strategic trading relationships,” Klisura added.

Guy Carpenter’s business leaders shared their views of the market, at a virtual media briefing, ahead of next week’s Monte Carlo rendezvous, and subsequent renewals discussions.

Guy Carpenter’s executives noted that after a historic reset in property pricing, programme retentions, and coverage in 2023, 2024 has been characterised by “a more orderly trading environment”.

This characterisation of the market is expected to continue in 2025, the reinsurance broker said, subject to the usual caveat that there be “no major natural catastrophe loss activity for the balance of the year”.

Renewal negotiations for casualty reinsurance treaties are expected to continue to focus on underlying rate environment and portfolio performance, according to Guy Carpenter said.

Casualty programmes are expected to complete with adequate capacity but with continued scrutiny across sublines.

Chairman of Guy Carpenter, David Priebe, emphasised that risk appetites continued to improve through the first half of 2024, building on mid-year momentum, while underwriting discipline remains.

“This current trading cycle is marked by engaged stakeholders actively coming to the table to provide critical capital and financial support to the economy,” he said.

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