Gallagher Re: April renewals give cedants chance to reshape programmes

The reinsurance broker’s latest “First View” report highlights continued softening across property and specialty lines, extending trends seen at 1 January, while casualty pricing remained broadly stable.

Against a backdrop of geopolitical uncertainty and a softening primary market, reinsurers remained well capitalised and actively competed for well-structured risks, supporting cedants’ ability to negotiate improved terms and explore more tailored coverage solutions.

Property catastrophe pricing fell sharply in several regions, with risk-adjusted rate reductions ranging from -7.5% to -25%, while Japanese property cat programmes saw declines of between -15% and -17.5% following a loss-free year.

Japanese cedants, a key focus of the renewal, achieved reductions in the high teens on property cat portfolios, reflecting improved underlying performance and prior portfolio remediation.

In casualty lines, pricing dynamics were more nuanced, with slight increases in risk-adjusted rates offset by lower overall premium spend, as cedants demonstrated reduced US exposure and improved portfolio volatility.

The report emphasises that while falling prices reduce cost, they do not automatically improve portfolio economics, highlighting a shift towards more strategic use of reinsurance.

Tom Wakefield, global CEO of Gallagher Re, said the current environment offers a rare window for structural change.

“There is an opportunity for clients to use the current window to reduce cost and to build the kind of structural protection that positions them well for whatever comes next,” he said.

“Gallagher Re’s analytical depth, market relationships, and structural creativity are helping clients to turn current conditions into durable advantage,” Wakefield added.