A brisk breeze gets the boys in Omaha, Zurich, Munich and London (Lloyds) talking about premium increases.
Not to mention the herverzekering crowd in Amsterdam, they're tough bastards.
It was only a matter of time. Where there are catastrophe losses, there is talk of reinsurance rate increases.See also:
In light of the high catastrophe losses from the Chilean earthquake, which could reach $8 billion, reinsurers are now signaling that they may try to raise rates at the next renewal. QBE Insurance (QBEIF) believes that rate increases may be necessary, as reinsurers try to recapture capital depleted by quake-related payouts.
This follows an average property-catastrophe rate drop of as much as 15%, according to Aon Benfield (AON). So, following such a steep drop, reinsurers are eager to pick up increases where they can.
The next major reinsurance renewal comes on April 1, 2010 and is largely an international affair. It will provide an opportunity for reinsurers to try to recapture some of their capital, but the talk now itself implies that the desired outcome is unlikely. Reinsurer are price-takers, not price-setters, so insurers will probably setting the terms over the next few weeks, as usual.