Conduit: Property reinsurance rates stay ‘buoyant’

Property reinsurance rates remain buoyant, and that trend should continue through the January 1 renewals, according to Conduit Re chief executive officer Trevor Carvey, speaking at a Monte Carlo briefing on September 10.

In contrast, the casualty market remains more challenging, but the co-founder of the Bermuda-based reinsurer said his company had not seen adverse developments emerging for the years since 2021 when the company started underwriting.

Carvey said the property risk market continued to enjoy “elevated” rates and terms and conditions. Conduit has less exposure to property-catastrophe reinsurance.  

“Our view is that across the various classes that we transact, the market has had a very good run since we came into being in 2021,” he said at a briefing. “The majority of those classes have been operating at an elevated level, rating-wise. And by the way we view terms and conditions, they are still very good.” 

Carvey said there had been some “rate deceleration” in certain classes, adding: “Overall, it is a buoyant market, and through the rest of this year and into 2025 we are having a pretty good run.” 

Carvey said margins for property risk remained attractive, adding that while rates fell on a risk-adjusted basis in the mid-year wind renewals, Conduit adjusted its position and “wrote around that”. 

“There is still plenty of wind season to go, so we never count our chickens too early in that respect,” he added. 

On casualty, Carvey said the company was focused on understanding the loss trend in order to price the risk. 

“2023 was a good year for the retro market in general.”

“While certain classes have experienced adverse prior year claims, we would not typify the whole casualty space as being impacted,” he said. 

He added that the casualty years Conduit had underwritten from 2021 were “tracking through absolutely within our pricing expectations”. 

Greg Roberts, Conduit’s chief underwriting officer, was guardedly optimistic about retrocession.  

“A lot of the capacity in the retro market, particularly on the ILS and third party side, is looking forward to a better year,” he said. “If you think of the experience of the last five years, 2023 was a good year for the retro market in general. 

“One year does not make a trend,” he added. “There is quite a bit of capacity at the moment, at those terms and conditions, so the state of the market is stable, which sounds a bit generic, but is fair.” 

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

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