LONDON, July 01, 2015 (GLOBE NEWSWIRE) -- While competition remains intense for non-peak areas where traditional reinsurers still dominate the market, signs of reinsurance pricing stabilization are starting to emerge in peak property catastrophe zones as supply and demand begins to equalize, according to the latest 1st View Renewals Report from Willis Re, the reinsurance division of global risk advisory, re/insurance broking, and human capital and benefits firm Willis Group Holdings plc (NYSE:WSH).
According to the report, the recent pricing trend across both the June 1 and July 1 2015 renewals is a result of the significant increase in demand for Floridian catastrophe capacity. Secondly, the recent swell in capacity from collateralized reinsurance markets - which has played a major role in driving pricing down in the peak zones - appears to have abated, with a number of these markets now showing pricing discipline by cutting the capacity they are prepared to offer as rates continued to soften throughout the first half of 2015.
While property catastrophe pricing competition may be cooling, the reinsurer M&A frenzy continues. The report notes that despite the unappealing short-term outlook for nearly all companies across the sector, such activity is helping to maintain current high valuations, and despite diminishing underwriting and investment returns being delivered, investor capital continues to be attracted to the sector.
Looking ahead to 2016, John Cavanagh, Global CEO of Willis Re, said: “The June 1 and July 1 2015 renewal season offers reinsurers some hope. With the North Atlantic Hurricane season now underway, even if the predicted low level of hurricane activity is realized, the outlook for 2016 might not be quite as bleak as may have been inferred from the January and April 2015 renewals.”
Download the report: The Willis Re 1st View report includes specific commentary on key trends throughout the world's major reinsurance classes and regions.
About Willis Re
One of the world's leading reinsurance brokers, Willis Re is known for its world-class Analytics capabilities, which it combines with its Reinsurance expertise in a seamless, integrated offering that can help clients increase the value of their businesses. Willis Re serves the risk management and risk transfer needs of a diverse, global client base that includes all of the world's top insurance and reinsurance carriers as well as national catastrophe schemes in many countries around the world. The broker's global team of experts offers services and advice that can help clients make better reinsurance decisions and negotiate optimum terms. For more information, visit www.willisre.com.
Willis Group Holdings plc is a global risk advisory, re/insurance broking, and human capital and benefits firm. With roots dating to 1828, Willis operates today on every continent with more than 18,000 employees in over 400 offices. Willis offers its clients superior expertise, teamwork, innovation and market-leading products and professional services in risk management and transfer. Our experts rank among the world’s leading authorities on analytics, modeling and mitigation strategies at the intersection of global commerce and extreme events. Find more information at our website, www.willis.com, our leadership journal, Resilience, or our up-to-the-minute blog on breaking news, WillisWire. Across geographies, industries and specialisms, Willis provides its local and multinational clients with resilience for a risky world.
Source:Willis Group Holdings