Moody’s shifts outlook for global reinsurance sector to positive

Moody’s Investors Service has upgraded its outlook for the global reinsurance sector to positive.

Higher prices and tighter policy terms, coupled with limited new capital entering the market, will drive continued strong profitability over the next year, assuming no large catastrophes occur, Moody’s says in a report.

Property reinsurance pricing is expected to remain “favourable”, while prices for casualty reinsurance have also risen, the report says.

Reinsurers, though, are seeing rising casualty claims, driven partially by increased litigation in the US. They may add reserves to blunt the increased litigation and higher jury awards, Moody’s says.

Prices are forecast to remain stable or increase in 2025 based on Moody’s annual survey of reinsurance buyers, but the survey “points to a slowing pace of rate increases and some rate decreases in catastrophe-exposed property lines”.

In a separate report, Moody’s says most respondents to its annual survey of global property & casualty reinsurance buyers “expect reinsurance prices to remain stable or increase in 2025 in a sign that reinsurers will maintain healthy pricing and tight terms and conditions in most business lines for another year”.

Moody’s adds, however, “our survey points to a slowing pace of rate increases and some rate decreases in catastrophe-exposed property lines”.

Buyers mainly attribute continued rate increases to rising loss costs, and some also cite the continued limited supply of reinsurance, Moody’s says.

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