NU Online News Service, June 23, 1:31 p.m. EST
Bermuda insurers and reinsurers see price increases for property catastrophe risks, but recent events are not translating into broader industry increases, according to report released by Keefe, Bruyette & Woods.
In an analysts' note, KBW says discussions with 12 insurers, reinsurers and brokers indicated that rates for property and catastrophe on mid-year reinsurance renewals are up 8-12 percent, and the outlook is for continued increases into January renewals for those risks.
Outside of the United States, primarily in Australia, New Zealand and Japan—the three regions hit by devastating natural catastrophes—rate increases are expected to reach or exceed 50 percent.
European property rates are expected to be impacted come Jan. 1 renewals, primarily driven by the latest Risk Management Solutions model that increases exposure.
However, KBW says executives indicated that the increases were not broad-based.
KBW noted that "demand was lower than some expected and there was sufficient capital to meet demand."
There was no increase in merger and acquisition activity and the recent announcement of Allied World Holdings and Transatlantic Holdings, Inc. merger was met with positive notice.
KBW says the consensus feeling is that Allied World management "is uniquely qualified to successfully execute the deal" and there would not be counter-party offers to deal with.
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