AM Best has released a new report, “U.S. and Bermuda Reinsurers Gain Benefits as Market Conditions Improve,” as part of its look at the global reinsurance industry.
“Despite increased catastrophe activity, AM Best’s U.S. and Bermuda reinsurer composite recorded improved underwriting margins in 2021, with COVID-19-related claims at Minimized and greater contribution from investment results.
“Best’s new market segment report ‘US-Bermudian Reinsurers Benefit as Market Conditions Improvement’ is part of AM Best’s view of the global reinsurance industry ahead of the Rendez-Vous de Septembre in Monte Carlo.
“The US and Bermuda reinsurer populations will post a combined ratio of 95.8 in 2021, an improvement of 6 percentage points from the previous year, according to the report. , reducing the combined ratio by 6.1 points.
“Favorable reserve development is expected to continue as the report notes that COVID-19 claims have developed less than expected. Volumes are still occurring but not reported. [IBNR]Favorable reserve development would benefit, although inflation concerns could wedge various assumptions if recent accident year frequency and severity trends continue. ”
Associate Gregory Dickerson said: Director, AM Best.
A spokesperson said, “While Underwriters remains particularly cautious about its Florida exposures, it is unlikely that the long-term structural problems of the tort system will be resolved in the short to medium term. , capacity remains ample in many business areas, but the pricing environment for property catastrophe risk is improving, according to the report.
“Net premiums written grew a solid 20% in 2021, benefiting from significant rate improvements. AM Best forecasts further composite premium growth in 2022. , as demand has proven resilient and rates for most major lines of business continue to rise, albeit at a slower pace. Given continued improvements in reinsurance pricing, terms and conditions, as well as a quieter season, the composite is expected to increase its combined ratio to We should be able to improve, 2022 is not excessive.
“At the same time, U.S. and Bermuda reinsurers are focusing on growing their specialty and property and casualty portfolios, particularly in the excess and surplus markets where pricing is seen to outpace loss cost trends.
“To access a full copy of this market segment report, please visit this link.”
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