Peak Re strategises for growth in CEE as climate, and inflation shape dynamics

“In Europe, while we have solid penetration in mature markets, and we see significant opportunities for growth, particularly in Central and Eastern Europe (CEE),” Matteo Cussigh, chief executive officer of Peak Re AG, the Swiss subsidiary, who also has responsibility for the growth of its European portfolio. “Our aim is to expand across various sectors and deepen existing client partnerships.”

To achieve its vision and extend beyond its current areas of operation, Peak Re has adopted a strategic approach aimed at positioning itself as more than just a capacity provider. 

“With a forward-thinking approach to risk management, we will foster deeper partnerships and offer consistent support aligned with the long-term objectives of both Peak Re and our clients,” Cussigh added.

Catastrophe capacity

At this year's Baden-Baden conference, discussions will focus on the availability of capacity, particularly for catastrophe programmes with lower return periods. Key themes will include the impact of global warming, the reliability of risk models, and inflationary pressures affecting the market, Cussigh noted.

“It’s crucial to remind cedants that loss frequency remains high.”

He added that, although stable or slightly declining renewal rates were expected post-Monte Carlo, two major hurricanes in the US and a significant flood event in Central Europe, resulting in €3 billion in insured losses, have since added uncertainty. 

“These events are likely to influence the 2025 renewal outlook, potentially impacting pricing and market dynamics. It’s crucial to remind cedants that loss frequency remains high, with 2024 potentially seeing another year of well over $100 billion in losses,” he said.

Headquartered in Hong Kong, Peak Re remains committed to delivering value in emerging markets. In the Asia-Pacific region, middle-class households are particularly vulnerable to climate-related catastrophes, threatening economic growth and social stability—a growth opportunity for the reinsurer. 

Cussigh said this underscores the urgent need for increased insurance coverage in areas such as China, India, and Southeast Asia, where insurance penetration is significantly lower than in developed markets. With over half of the world’s urban population, Asia faces substantial climate risks, particularly in densely populated coastal regions. 

To address these challenges, Peak Re is focused on developing innovative solutions that bridge protection gaps, improve insurance accessibility, and build resilience against climate, digital, and geopolitical risks in emerging markets.

Underwriting discipline 

Over the next 12 to 18 months, Cussigh said, Peak Re will prioritise maintaining underwriting discipline and protecting company performance to secure sufficient capital returns. 

The company plans to diversify its P&C portfolio geographically and across various lines of business, including expanding its structured segment offerings and strategically growing its life insurance business. 

“While we have the capital and appetite for growth, we will pursue only economically sound opportunities and prioritise meaningful client partnerships,” said Cussigh.

Inflation remains a concern. While Consumer Price Index (CPI) figures are declining in advanced markets, external shocks such as supply chain disruptions, tariff changes, and geopolitical tensions could impede further easing. Although central banks have started lowering interest rates, the outlook remains uncertain.

Social inflation, especially in the US and increasingly in other regions, poses an additional challenge, exacerbated by labour shortages and frequent catastrophic events.

Post-COVID-19 pandemic, Europe has experienced a steady increase in catastrophe losses, such as the German and CEE floods and the New Caledonia riots, many of which involve non-modelled perils. This trend is expected to continue, with the growing frequency and severity of such losses remaining a significant concern. 

“To maintain insurability, we are collaborating with stakeholders to enhance catastrophe models and improve understanding of weather and climate patterns,” said Cussigh. “This is crucial for sustaining coverage for these events.”

While Peak Re is prepared to deploy capacity and support its cedants, the company remains firm in its stance not to revert to pre-2022 market conditions. “Our approach will remain measured and disciplined, ensuring long-term sustainability for both Peak Re and its clients,” he said.

Enhancing productivity

“At Peak Re, we view technology, including artificial intelligence (AI), as a positive force that enhances our operations,” Cussigh explained. “It allows our employees to move beyond routine tasks, enabling them to focus on developing valuable skills. 

“Technology and data-driven insights are becoming increasingly vital in underwriting decisions.”

The increase in digitisation has significantly improved efficiency and productivity by streamlining operations. This enables teams to concentrate on higher-value tasks that deliver superior outcomes for clients. Peak Re also partners with external experts to leverage technology for a deeper understanding of complex risks. 

By using advanced tools, the company refines climate models and gains insights into climate and weather patterns that are essential for precise underwriting.

“Technology enhances our insights and productivity, it does not replace human decision-making. At Peak Re, underwriting decisions are always made by our experienced experts, ensuring that technology supports but never overrides their expertise and judgement, to deliver the best outcomes for our clients,” he concluded.

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