Current renewal negotiations around rates will soon be superseded by more fundamental debates around retentions, attachment points and structures as cedants and brokers try to find a solution in what is one of the toughest renewals in a long time.
That is what Patrick Hartigan (pictured), head of treaty at Beazley, told Intelligent Insurer. Hartigan is in Baden-Baden calling for cedants to face reality on increasing rates and do the hard work on structures early—while also considering the long-term challenges of climate change.
“I don’t think people have worked out quite what their priorities are,” said Hartigan of his read on the cedant stance going into what is universally acknowledged to be an exceptionally challenging renewal season.
Hartigan lays out reinsurers’ challenges: they have lost money for five straight years, inflation has increased asset values, secondary perils are running rampant, capacity has fled volatile nat cat business, H1 investment losses trimmed capacity—and all that was pre-Hurricane Ian.