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Business Wire
3 days ago
- Business
- Business Wire
Best's Market Segment Report: Reinsurers' Disciplined Capital Deployment and Underwriting Remain Key Foundations
BUSINESS WIRE)--A recalibration of the global reinsurance market since the January 2023 renewal period has led to a more-durable market structure characterized by reduced earnings volatility and stronger margins, supporting AM Best 's continued positive outlook on the industry. The Best's Market Segment Report, 'Reinsurers' Disciplined Capital Deployment and Underwriting Remain Key Foundations,' starts off AM Best's look at the global reinsurance industry ahead of the Rendez-Vous de Septembre in Monte Carlo. Other reports, including AM Best's ranking of top global reinsurance groups and in-depth looks at the insurance-linked securities, Lloyd's, life/annuity, health and regional reinsurance markets, will be available during August and September. According to this report, the shift since the January 2023 renewal in how risk is priced, shared and retained across the reinsurance industry has carried forward and translated into a second-straight year of solid results in 2024. The European 'Big Four' reinsurers posted a discounted combined ratio of 86.4% under IFRS 17; the discounting on average lowers the combined ratio by approximately eight percentage points. The U.S. and Bermuda composite reported an undiscounted combined ratio of 89.5% under U.S. GAAP. These results confirm that underwriting profitability has not only rebounded but is being sustained in the current reinsurance cycle. 'Reinsurers' risk-adjusted capitalization levels remain robust, reflecting retained earnings and disciplined capital management, and the strong underwriting profitability is being augmented by a surge in investment income given elevated interest rates,' said Michael Lagomarsino, senior director, AM Best. 'The absence of material new global reinsurance entrants also is ensuring that structural market discipline is maintained, distinguishing the current environment from previous market cycles.' According to the report, most global reinsurers have maintained their strong performance through the first half of 2025, despite global weather-related insured losses that will likely top USD 100 billion. These losses are primarily driven by the California wildfires, which many reinsurers are marking in the range of USD 30-50 billion. 'Assuming no further material weather events in the second half of 2025, the combination of disciplined underwriting, rate adequacy and robust investment income should deliver full-year operating results exceeding the cost of capital,' said Dan Hofmeister, associate director, AM Best. Global reinsurers also face headwinds other than climate change, including social inflation, growing geopolitical tensions and trade disputes, and these challenges underscore the importance of the market's improved structural foundations and explain why AM Best's outlook, though positive, remains closely scrutinized. 'The question now facing the industry is whether the improvements in terms and conditions represent a durable shift,' said Steven Chirico, director, AM Best. 'The lessons of past cycles suggest caution, but reinsurer sentiment has ensured tighter exposure management and market disciple in the current cycle.' To access the full copy of this market segment report, please visit For global reinsurance reports ahead of Rendez-Vous de Septembre, as well as video coverage of the event, please visit AM Best's Reinsurance Information center. Lastly, AM Best will host its annual reinsurance market briefing at Rendez-Vous de Septembre on Sept. 7, 2025, at 10:15 a.m. (CEST) in Monte Carlo. For more information, please visit the event website.
Associated Press
28-02-2025
- Business
- Associated Press
AM Best Affirms Credit Ratings of Vantage Risk Ltd. and Its Affiliates
AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings of 'a-' (Excellent) of Vantage Risk Ltd. (Bermuda) and its affiliates, Vantage Risk Specialty Insurance Company and Vantage Risk Assurance Company (both domiciled in Wilmington, DE), which does business as Vantage Group. The outlook of these Credit Ratings (ratings) is stable. The ratings reflect Vantage Group's balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management. The rating affirmations follow an active initial four years of operations for the group. In the first two years, underwriting income was impacted adversely by elevated catastrophe losses; however, as Vantage Group has continued to grow to scale in 2023 and 2024 and moved property catastrophe business off its balance sheet through its insurance-linked securities vehicle, AdVantage Retro I Ltd., its underwriting results have improved. Vantage Group's strategy is expected to provide the group with accretive income while continuing to reduce volatility in its operating results in future years. Over the past two years, the group has achieved operating profitability though the group has yet to achieve a full-year combined ratio below 100. AM Best expects full-year combined ratios for 2024 to continue to benefit from these changes and track close to breakeven. Vantage Group continues to expand its primary insurance operations, after a slow start in 2021, due to various operational challenges. As the group continues to execute its business plans, the reinsurance portfolio has become relatively smaller than the primary portfolio; and thus, has less of an impact to its bottom line. While Vantage Group's diversification and capabilities have expanded significantly since launch, some level of operational risks remains as new business seasons. AM Best will continue to monitor the group's progression as it enters its fifth year of operation. AM Best anticipates that Vantage Group's operating performance will continue to improve as its business plan is executed. This press release relates to Credit Ratings that have been published on AM Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best's Recent Rating Activity Guide to Best's Credit Ratings. For information on the proper use of Best's Credit Ratings, Best's Performance Assessments, Best's Preliminary Credit Assessments and AM Best press releases, please view. Financial Analyst +1 908 882 2237 Dan Hofmeister Associate Director +1 908 882 1893 [email protected] Christopher Sharkey Associate Director, Public Relations +1 908 882 2310 [email protected] Al Slavin Senior Public Relations Specialist +1 908 882 2318 SOURCE: AM Best Copyright Business Wire 2025. PUB: 02/28/2025 03:20 PM/DISC: 02/28/2025 03:20 PM
Yahoo
26-02-2025
- Business
- Yahoo
Best's Market Segment Report: Casualty Reinsurance Capacity Remains Plentiful, Concerns Over Future Availability Loom
OLDWICK, N.J., February 26, 2025--(BUSINESS WIRE)--Rising litigation costs and higher jury awards continue to generate financial pressure within the casualty reinsurance segment, forcing reserve strengthening measures for some carriers and prompting narrower margins, according to a new AM Best report. The Best's Market Segment Report titled, "Casualty Reinsurance Capacity Remains Plentiful Amid Concerns," states that reinsurers continued to provide ample capacity through the recent January 2025 renewal season. However, there is potential for the casualty segment to encounter an availability crisis in the absence of interim actions to offset some pressure points. A panel discussion during a recent AM Best briefing on reinsurance renewals indicated that U.S. reinsurers with a casualty reserve portfolio that gain 8%-10% in rate increases are not keeping pace with loss cost trends. The markets that are pushing for 15%-20% rate increases may be the ones that overcome these challenges, according to that discussion. "Social inflation remains a key driver of casualty loss trends on past years and continues to create uncertainty across the casualty landscape amid negative social sentiment," said Dan Hofmeister, associate director, AM Best. Hofmeister was referring to the rising costs of insurance claims due to a combination of factors such as increased litigation, higher jury awards and a broader interpretation of policy coverage. These factors have placed substantial pressure on reinsurers, forcing them to reassess their pricing models and reserve adequacy. In 2024, many global reinsurers reported reserve strengthening efforts to combat adverse development. In 2022, a lack of investor willingness to absorb increased property market volatility led many reinsurers to reduce their dedicated capacity for the related lines of business. Much of that capacity was redirected into casualty lines, which the equity markets appear to favor. "We examined publicly traded reinsurers' stock prices over the past 20 years," said Guilherme Simoes, senior financial analyst, AM Best. "We found that reinsurers with higher allocations to property lines saw a lower average yearly increase in stock prices compared with those with higher allocations to casualty lines." The report notes that reinsurance market reported adverse reserve development on prior casualty years throughout 2024, and the problems are not anticipated to slow in the near term. The casualty segment differs from the property in that it is more complex and cannot be resolved through simple changes to attachment points or underlying terms. The underlying business will continue to deteriorate as social inflation drives up loss costs, according to the report. To access the full copy of this commentary, please visit AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit Copyright © 2025 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED. View source version on Contacts Dan Hofmeister, CFA, FRM, CAIA, CPCU Associate Director +1 908 882 1893 Christopher Sharkey Associate Director, Public Relations +1 908 882 2310 Guilherme Monteiro Simoes, CFA Senior Financial Analyst +1 908 882 2317 Al Slavin Senior Public Relations Specialist +1 908 882 2318 Sign in to access your portfolio
Yahoo
29-01-2025
- Business
- Yahoo
AM Best Assigns Credit Ratings to MTAW Insurance Company
OLDWICK, N.J., January 29, 2025--(BUSINESS WIRE)--AM Best has assigned a Financial Strength Rating of A (Excellent) and a Long-Term Issuer Credit Rating of "a+" (Excellent) to MTAW Insurance Company (MTAW) (Wilmington, DE). The outlook assigned to these Credit Ratings (ratings) is stable. The ratings assigned to MTAW reflect its reinsurance agreement with United States Fire Insurance Company. The ratings also reflect Crum & Forster Insurance Group's consolidated balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management. As a result of MTAW's reinsurance agreement, its credit risk is reflected within United States Fire Insurance Company's balance sheet going forward. This press release relates to Credit Ratings that have been published on AM Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best's Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best's Credit Ratings, Best's Performance Assessments, Best's Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best's Ratings & Assessments. AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit Copyright © 2025 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED. View source version on Contacts Dan Hofmeister, CFA, FRM, CAIA, CPCUAssociate Director+1 908 882 Greg DickersonDirector+1 908 882 Christopher SharkeyAssociate Director, Public Relations+1 908 882 Al SlavinSenior Public Relations Specialist+1 908 882 Sign in to access your portfolio
