SCOR grows 13.6% at 1.1, ends-around core P&C for margin gain
Global reinsurer SCOR increased its book by an adjusted 13.6% to € 4.25 billion at the 1.1 renewals, staving off growth in key property and casualty lines while diving headfirst into select specialty plus alternative solutions for a hoped-for margin gain.
Growth should continue throughout the year as “risk-adequate prices” bold up for the 2024 renewals, SCOR said. A “strong pipeline” in alternative solutions may continue to lead.
“I expect the attractive market conditions to continue over the remainder of the year, fuelled by the demand from cedants and continued discipline by reinsurers,” Jean-Paul Conoscente (pictured), SCOR’s CEO for P&C reinsurance, said of outlook.
SCOR booked its estimated premium increase on a 3.1% rate increase (excluding alternative solutions), including +6.6% on its non-proportional business.
The growth hero at SCOR came in alternative solutions, up nearly three times from the prior year level to €550 million, accounting for over 71% of SCOR's total adjusted renewal growth.
Management cited only “strong new business, meeting client demand for customized solutions” to explain the line’s explosion.
The core P&C book was nearly growth-free. The P&C reinsurance book for property, property cat, casualty, motor and personal lines and others inched up by a fractional 0.8% to €2.20 billion in estimate premium income, SCOR said.
SCOR attributed the slow pace to “continued disciplined nat cat underwriting and decreasing exposures in US casualty.”
Nat cat premium rose 9.9%, driven “primarily” by price while SCOR maintained its strategic underweight to such exposures.
US casualty exposure are down “slightly,” SCOR said, citing “a prudent approach” of renewals with “selected clients.”
SCOR tossed a number of specialty niches into that go-slow basket including nuclear, terrorism, special risks, motor extended warranty, and inwards retrocession, management noted.
Growth came elsewhere, including a 9.4% increase in estimated premium income from global treaty, a category into which SCOR lumped agriculture, aviation, credit & surety, inherent defects (IDI), engineering, marine and offshore, space and cyber.
A higher-growth sub-set of engineering, marine, IDI and international casualty was said to have risen by a stronger 13.3%.
Notably, SCOR provided only adjusted premium estimates, excluding SCOR’s third-party capital provision business at Lloyd’s as well as one unspecified large structured transaction.
The shape of growth and gain in rate should be margin-supportive to the tune of a 1.5 point reduction in SCOR’s net underwriting ratio. SCOR claimed to have retained all of 2023’s gains in terms and conditions.
On retrocession, SCOR said only it “improves its protection with enhanced capacity and coverage expansion at constant cost.”
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