Conduit Re warming to specialty lines as 1.1 heralds new market era

Bermuda-based reinsurer  Conduit Re may be warming to specialty lines after a period of having eschewed its terms, pricing and bundling as the 1.1 renewals showed a corner hopefully being turned, top company officials have said.

“The market has corrected significantly in this space now and 2023 certainly present a better or perhaps fairer playing field for reinsurers,” CEO Trevor Carvey (pictured) said of unspecified specialty lines.

To date, Conduit Re has underweighted the segment, citing frequently inadequate pricing and a “lack of transparency” in deals presented, often on account of a broad bundling across specific specialty covers. “This is a major reason why we resisted placing more into the space,” Carvey said.

Gross written premium rose 52% in the specialty segment in 2022, below the group GWP growth of 68%. Specialty accounted for 16% of 2022 GWP, well below the 24% referenced in the initial IPO plan.

Conduit claimed a 14% rate increase in specialty at the 1.1 renewals, what chief underwriting officer Greg Roberts called “a structural kick-forward in pricing,” after having been able to take more than 2% during each of the quarters of the preceding year.

The 14% increase came with “a very much improved set of terms and conditions,” Roberts said, a change that “was due” given the long-running trend towards “over-bundled” deals with insufficient wording.

“A number of specialty classes are now warranting our attention and warranting our risk appetite,” Roberts said.

Specialty should be well-suited to Conduit’s desire to closely manage and limit cat exposures, Roberts added.

Did you get value from this story?  Sign up to our free daily newsletters and get stories like this sent straight to your inbox.