(Bloomberg) — Reinsurance prices declined on policies renewedfor July 1 amid low losses and as record levels of catastrophebonds drove an oversupply of capital, according to Guy Carpenter& Co. LLC.

There were “price decreases across virtually all geographies andlines of business, many in the double-digit range,” the reinsurancebroker of Marsh & McLennan Cos. said in a statement today.

The rates reinsurers charge customers are under pressure as lowinterest rates push investors, such as pension funds searching forabove-average returns, into their market. Below- averagecatastrophe claims have also left the industry, which shouldersrisks for primary insurers in return for a share of the premiums,with abundant funds.

About $5.7 billion of catastrophe bonds were issued in the firsthalf of the year, the highest for the period, the New York-basedcompany said. This year already is the fourth-largest in terms ofthe securities issued, Guy Carpenter said.

Catastrophe bonds enable insurers pay for cover against eventslike hurricanes or earthquakes. Investors get above- market yieldsfor taking the risk that their principal could be wiped out by alarge enough disaster.

“With an abundance of alternative capital, catastrophe bondpricing continues to decline,” David Priebe, vice chairman of GuyCarpenter, said in the statement. “Alternative capital is alsoextending its market impact through increased interest innon-catastrophe lines of business.”

In January, usually the most important month to renew annualproperty and casualty treaties, prices declined 11% and also fellfor most other types of coverage. Prices continued to drop for theApril 1 renewals.

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