Reinsurers show enough cat appetite to clear mid-year Florida renewals

Rising reinsurer appetite for US property cat exposure should be sufficient to grease the mid-year reinsurance renewals for property catastrophe cover in Florida at the mid-year renewals, top officials of the re/insurance broking group Marsh McLennan have declared. 

“Early signs for June 1 Florida cat risk renewals point to improved market conditions for cedants,” Marsh McLennan group CEO John Doyle told his company's first quarter earnings call. 

“Increased appetite for growth should be adequate to meet higher demand,” Doyle said. 

Comments come amid satisfaction from Marsh McLennan leadership with the relative stability of the market seen at the April 1 renewal deadline. Doyle cited US property cat rates largely flat with “some decreases” achieved for loss free accounts while loss impacted accounts had to tack a fresh 10-20% on the top. 

“Reinsurer appetite has increased for property cat,” Dean Klisura, CEO of  Marsh McLennan's reinsurance broking unit Guy Carpenter, added. “There is an inflow of capital and capacity.” 

The increases in capacity follows an increase in demand, both of which focus quite clearly at the top of the reinsurance towers, Klisura said. “The competition at the top end of programmes ... it’s good for both buyers and sellers in the marketplace.” 

Captives may the premium on the margin if cedants make any larger move towards increased reliance on traditional solutions amid the calming market, CEO Doyle suggested.

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