Reinsurance Rates Stable in April Renewals, Guy Carpenter Says
Reinsurance prices remained little changed in the April renewal round, a significant date for setting costs in the Asia Pacific region, after supply of available capital increased, Guy Carpenter & Co. LLC said.
“Pricing stabilized in most regions as insurers benefited from an environment of dynamic capital growth,” David Flandro, Global Head of Business Intelligence at the New York-based agent and broker, said in an e-mailed statement today.
Reinsurers, which help primary insurers shoulder risks in return for a share of premiums, accumulated a record $500 billion of capital by the end of last year, pushing up supply by more than 10 percent, Aon Benfield, the world’s largest reinsurance broker, said in a report this month. After lower insurance losses and higher investment income last year, prices are expected to remain unchanged in 2013 while lower interest rates may weigh on earnings, it said.
In Japan, reinsurance rates fell slightly as there were no major natural catastrophes, Guy Carpenter said. Korea had a turbulent year with three typhoons pushing up prices, it said.
Renewals for U.S. clients were few but “sizable” with “traditional pricing down generally in the single digit range,” the firm said.
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