Only catastrophe-exposed andloss-affected reinsurance contracts experienced any significantupward movement in rates at the Jan. 1 renewals, according to onetop executive.

During a Jan. 3 conference call, Aspen Re CEO Brian Boornaziansaid the “insurance and reinsurance markets are starting to acceptthe need for change,” as the markets start to recognize that therisks taken need more rate for adequate returns.

However, more change is needed “to reach rate levels that areadequate for exposures and other external factors that affect ourindustry’s profitability,” Boornazian said from Bermuda.

Several signs—high catastrophe losses, the release of RMSVersion 11.0 and low investment yields—point to the formation of ahard market. Boornazian says the market began to harden only incertain lines at Jan. 1 renewals, but it is “not a classic hardmarket.”

According to Aspen Re’s head executive, rates at Jan. 1 renewalsrose between 7.5 percent and 15 percent for larger propertyinsurers and excess-and-surplus lines writers in the U.S. Moreincreases were seen on contracts affected by losses.

Turning to Europe, the renewal season for property business sawonly low-single-digit percentage increases, Boornazian said.

In Asia, January is not a significant time for reinsurancerenewals. Real change here is needed, Boornazian said during thecall, but “early signs are that we will see inconsistentcorrections.”

Rate improvements in casualty reinsurance “remains elusive”internationally, he added, but the U.S. casualty market saw pocketsof rate increases in response to contracts with loss development,“and very limited requests for rate decreases.”

In a Jan. 1 report, independent reinsurance-brokerage firmHolborn says U.S. reinsurance programs with rate increasesoutnumbered those with decreases over the last year.

Primary rates in the U.S. have been rising.