Source: asiainsurancereview.com

For the upcoming rounds of reinsurance renewals in the Asia-Pacific region on 1 January 2022 and 1 April 2022, Hannover Re anticipates stable reinsurance conditions and prices with more pronounced positive changes for treaties that were affected by the COVID-19 pandemic or other losses.

In a statement released last week, the global reinsurer says that the Asia-Pacific region is evolving into one of the largest global insurance markets with its growth holding the promise of further significant business opportunities, in part because the insurance density in the region is still lower than in more mature markets.

Higher rates

The reinsurer says that not only in property and casualty reinsurance but also in the health and provision sector, appreciable growth rates can be anticipated over the medium to long term, which will also benefit reinsurers.
Overall, Hannover Re anticipates a continuing trend towards higher prices and improved conditions in property and casualty reinsurance for the various rounds of renewals in 2022.

Nat CAT

The sometimes far above-average large losses recorded in past years have further increased the need for action on the part of reinsurers. Pandemic-related costs and the low interest-rate environment are an additional strain on the results generated by primary insurers and reinsurers. Inflation rates have also been rising of late in some regions. This has further heightened risk awareness among primary insurers and given an added boost to demand for high-quality reinsurance protection.

“In property and casualty reinsurance there is a need for further rate increases. Only in this way will reinsurers be able to provide reliable risk protection in an increasingly challenging environment,” said Mr Jean-Jacques Henchoz, CEO of Hannover Re. “Particularly where natural catastrophe risks are concerned, adjustments are unavoidable. While the pace of price increases has slowed somewhat of late in the renewals during the year, this was primarily the case in areas where substantial increases had already been recorded in prior years.”