Reinsurance prices are on the rise and are primed to continue soaring, according to Flagstone Re.
The Bermudan reinsurer said natural catastrophes in 2010 and in Q1 2011, combined with changes to the RMS model and a weak US dollar have forced prices up.
Flagstone Re reported price rises at 1 April renewals, adding there are indications are that there will be further increases in June and July renewals.
Despite arguments from some brokers that recent events are not market-changing, Flagstone chief underwriter Guy Swayne said: “What we are seeing is, in the regions affected, prices are going up significantly, and then there is also a general trend of rising prices.”
But the reinsurer also said price increases had been mixed across the sector:
- More than 30% in Australia and New Zealand - more than 30 percent
- Increases of 3% to 4% in some European programs
- Windstorm prices in Japan up 5% to 10%
- Of the few Japan earthquake that renewed (mainly non-life), prices rose 30% to 50%
- Of the remaining Japan earthquake programs that invoked the extension clauses following the March earthquake, prices are expected to rise by 50% to 100%