Hamilton steps up as contrarian casualty reinsurance bull

Hamilton may be the reinsurance market’s most vocal contrarian casualty bull, claiming that dislocation in the reinsurance market and attractive conditions in primary underwriting merit a deeper lean into the segment, top officials have indicated. 

“This year, as the year progressed, we started to see some dislocation in the casualty space, and particularly in casualty quota share business,” CEO Pina Albo said in what she admits is a straight comparison to the prior dislocation in the property market that triggered a fuller market reset. 

“We saw an opportunity to lean in,” she told her company’s fourth quarter earnings call. 

Quota share looked like the best tool based on strong conditions for primary underwriters and demand for the product. “Primary rates and increasing, commission terms are favourable,” she said, comparing again to Hamilton’s prior off-consensus move to offer quota share during the property reinsurance market reset. 

Hamilton responded to the perceived opportunity by either increasing line sizes from what management believes were “small levels” going in, and also by extending casualty covers to clients already on the Hamilton books for property or specialty exposures. 

Inflation and social inflation, the core cause behind casualty segment retreats from any number of reinsurance rivals, often hand in hand with added reserving, are rather an argument for continued improvement in underlying conditions. 

“We think this will sustain a favourable market,”  Albo said. 

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