Japan sees single-digit rate reductions in April renewals
Reinsurers recorded single-digit risk adjusted rate reductions in Japan’s April 1 renewals, according to William Thompson, regional director of broker Willis Re.
“The reductions were single-digit and not in the low double-digit range, which were seen 12 months ago,” said Thompson in AM Best’s most recent Asia-Pacific Weekly.
Japan has experienced over-supply of capacity as the country remains a core territory for existing reinsurers and a key target for a number of new reinsurers.
“Although increased limits were bought, further rate reductions were achieved [in April renewals],” Thompson said.
Risk adjusted rates declined between 2.5 percent and 7.5 percent in property catastrophe excess of loss. At the same time, there was an uptick in the number of reinsurers reducing written lines due to compressed margins.
Major Japanese nonlife groups’ centralized reinsurance models continue to evolve, and international placements including some domestic exposures persisted in the April renewals, Thompson noted. For reinsurers there are ongoing drivers to adopt more client-centric approaches in their underwriting with many looking to promote diverse and coordinated product offerings.
The three major nonlife groups’ overseas premiums have trended upward, with international business accounting for about 15 percent of their total net premium incomes. In recent years, these Japanese nonlife groups have planned to integrate their international business under a single platform.
Japanese insurance group MS&AD is integrating its Lloyd’s syndicates and reinsurance operations under MS Amlin. Lloyd’s Syndicate 3210 was merged into Syndicate 2001 for the 2017 year of account.
Sompo Holdings is also merging its international businesses following its acquisition of Bermuda-based Endurance, which was completed recently for a total consideration of $6.3 billion.
Following the acquisition, Sompo has launched a fully integrated global commercial insurance and reinsurance platform based in Bermuda.
The new underwriting platform will include Endurance and also encompass Sompo's existing international commercial re/insurance businesses.
Today’s top stories
Fidelity & Guaranty Life terminates merger agreement with Anbang
Swiss Re sets up Asia headquarters in Singapore
Cincinnati Insurance hit by $106m cat loss in Q1
Pioneer appoints vice president for special risk division
Pro Global hires from Crawford to boost German business
Grinnell Mutual launches national reinsurance programme
Did you enjoy reading this story? Sign up to our free daily newsletters and get stories like this sent straight to your inbox.
