Although the pricing cycle for reinsurers is at a critical juncture, Standard & Poor's analysts say they are confident that enterprise risk management practices will encourage cautious pricing and prevent future downgrades.
A report released yesterday by Standard & Poor's Ratings Services, "2008 Reinsurance Renewals: Underwriting Discipline Takes Center Stage As Price Adequacy Declines Further," found that while pricing for most lines of business, across most geographies, is still adequate for the risks being covered, many segments appear to have reached the point where further price reductions would signal the transition from a softening market into a soft market.
Thomas Upton, an S&P analyst in New York, told National Underwriter, however, that "thus far, the evidence that we have suggests that the reinsurers are holding the line."
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