Casualty capacity one of top concerns as execs expect to grapple with rates and T&Cs

Rates and terms and conditions along with the availability of capacity will be the main talking point top of mind for re/insurance executives this renewal season. As things kick off at the first conference of the year in Monte Carlo this week, this might be a surprise to some under the impression that a relative equilibrium had settled in the markets.

That is one of the core findings of Intelligent Insurer’s 2024 pre-renewals season survey, which was distributed to industry executives globally. Answering the question about the main talking points during conference season (and able to select multiple responses) more than 55 percent of responders selected rates and terms and conditions while 46 percent selected capacity.

“We are nowhere near where we were two years ago, but uncertainty remains on some lines of business,” one said. “Casualty business is becoming a real challenge in the US. Property is more settled but the negotiations on loss-affected lines could be intense in some cases.” 

Another noted, in relation to casualty: “Social inflation and the impact on replacement cost values and loss adjustment expenses.”

This was reflected in the way others responded. Losses from recent events featured highly as did climate change, with some 30 percent of executives selecting each. “The profits have come but the loss trends remain worrying,” one said. “The impact of climate might just be worse that we ever imagined.”

Other talking points that featured highly were how to achieve growth and the impact of artificial intelligence (AI), although the latter at 16 percent might be lower than expected. 

We asked respondents about some of the other big issues on their agendas. Perhaps tying in with the earlier answers, profitability topped the list with almost 55 percent responding, while new and emerging risks including cyber and climate change also proved big worries. 

One respondent noted: “Companies need to focus on achieving a profit on the business currently being written. With profit margins already thin, gone are the days when a company could achieve a profit in one line and use some of that profit to offset losses in another line.”

On a similar vein, another remarked: “Profitability and stability, growth in product lines with existing and new clients. Identifying new clients where we commonly share values and vision.”

Why go to conferences? 

We asked what individuals hope to get out of conference season: why are such events important? The biggest response was that executives like to learn new things and get a feel for understanding any trends. That said, most are very relationship-driven.

“Conferences such as the Monte Carlo Rendez-Vous and APCIA provide a chance to meet with other industry professionals and gain valuable insight face to face as to the direction of the market in terms of the availability of capacity and pricing/terms,” said one respondent. Another added: “Catching up with clients and reinsurers is a principal goal.”

For more news from the Rendez-Vous de Septembre (RVS) click here.

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