From the upper echelons of the retrocession sector, through to reinsurance and then onto the commercial and personal lines markets, there is certainly a sense of dislocation and disruption as the industry comes to terms with a whole host of competing trends.
On the one hand, industry capital levels continue to be far higher than what is actually needed. That has the effect of putting downwards pressure on pricing as supply outweighs demand.
On the other hand, rising loss costs and tighter underwriting controls being implemented at some of the major market players mean there is also upwards pricing pressure.
Added into the mix is that while industry-wide capital remains at a high level, there are reductions and withdrawals in certain specific segments.
These dynamics make for a market that is rapidly changing and one where it is difficult to predict what will happen next.
The Insurance Insider, in partnership with technology specialist Phinsys, brought together a panel of industry experts to discuss these trends and how they are impacting the (re)insurance market in the US.
Hosted in New York at the official residence of Antony Phillipson, the UK’s trade commissioner for North America and consul-general, a diverse group of (re)insurance industry executives discussed a wide variety of topics including expectations for the upcoming 2020 renewals, the impact of social inflation, new opportunities on the horizon and what forms of InsurTech have caught their eyes, among others.
One of the main talking points was whether the pricing increases that have been seen in the past 12 months are actually enough to leave the market in a positive position – are the rate rises being imposed sufficient on a risk-adjusted basis?
Among the other changes going on in the marketplace is the shifting nature of the exposure, and this was a keen talking point for some participants.
It remains to be seen what positive impact, if any, the changes to assignment of benefits rules in Florida will have for carriers, while on the West Coast, the region continues to struggle to come to terms with the wildfires that have raged through parts of California.
How the industry gets to grips with these issues will be important in determining in its ability to write coverage for such perils in the future.
You can learn more about what was discussed by reading the full roundtable supplement.
To view the New York Roundtable supplement, please click here.