AXIS mulls growth in excess casualty, renewables, A&H and marine amid rate hikes
Re/insurer AXIS Capital is planning to expand in a number of business lines such as excess casualty, renewable energy, accident and health (A&H) and marine on the back of strong double-digit rate increases seen across 2020. It expects the continued insurance market firming to accelerate in virtually every line of business, driving further growth in 2021.
The Bermuda-based company reported an average rate increase of nearly 15 percent for full-year 2020 in its insurance business - with rates up 18 percent in Q4, 16 percent in Q3, 15 percent in Q2, and 10 percent in Q1.
AXIS said rates increased in almost every line of business with many classes achieving double-digit increases.
In its reinsurance business, pricing was up high in single digits throughout the year. At 1/1 2021, the average renewal rate increases were 12 percent across all lines.
AXIS expects the strong pricing momentum to continue into 2021 and possibly further, driven by issues such as low interest rates, lower levels of favourable development, social inflation and the COVID-19 pandemic. Also, the elevated frequency of hurricanes in the US during the second half of 2020 should further support firmer pricing, terms and conditions as the mid-year renewals approach, according to the company.
The carrier noted that specialty/wholesale channel is where AXIS has been accelerating the most growth - making up approximately 40 percent of the total premium year-to-date. The channel has been providing the strongest rate increases year-to-date.
At the same time, lines such as excess casualty, renewable energy, A&H and marine are showing strong double-digit ROE opportunities.
The company is also seeing improvements from exiting underperforming lines, reducing expenses, disciplined underwriting, and investing in more attractive markets.
AXIS stated that it has been focused on growing core lines of business where risk selection and rates are adequate to drive "sustainable profitable growth".
Did you get value from this story? Sign up to our free daily newsletters and get stories like this sent straight to your inbox.
