Aon: client differentiation and data are crucial for 1/1

Helping clients differentiate themselves is a key component of Aon’s strategy as the company works towards a “challenging” January 1 renewal, according to Kevin Traetow (pictured left) and Stephen Hofmann (pictured right), co-presidents for Aon’s US Reinsurance Solutions. Intelligent Insurer spoke to them as they prepared for this year’s industry meeting in Dallas, Texas.

Speaking about recent dynamics in the market, Hofmann said that US insurance had experienced disruption in the property market even prior to Hurricane Ian making landfall, caused by concerns over the impact of inflation, climate change, model miss and uncertainty over secondary perils.

In addition, catastrophe loss volatility experienced by the property market has put an inordinate amount of scrutiny on the line of business. This is at a time when there is an increased demand by insurers for property reinsurance capacity, while reinsurers are repositioning their business due to their past performance, a difficult retrocessional market and reduced appetite by investors in the line of business.

According to Traetow, significant rate increases were ubiquitous at the mid-year renewals, with rises on top of how the clients’ exposures changed year over year. This is a trend he expects to see continue.

But, he added: “We want to take special care as we work with our clients on what their exposure really tells us. So risk-adjusted—what does it mean as they provide us with updated exposures, as well as considering other factors such as inflation?

“We work very hard with our clients to generate a comprehensive and realistic view of their risk.”