Canadian reinsurance market expected to remain stable: Aon Benfield

Growth in reinsurer capital and capacity will exceed client demand for January 2011 renewals, absent any significant reinsurer losses for the remainder of the year, Aon Benfield reports. “As a result, market forces will drive a global softening of rates, terms and conditions in the reinsurance market,” according to the company’s Reinsurance Market Outlook: Abundant Capital to Cultivate Growth. In Canada, pricing and capacity have remained stable for all lines of business in the first half of 2010, with this trend expected to continue through fall renewals. “Property lines, both catastrophe and per risk, continue to be attractive to reinsurers and some modest (up to 5%) decreases may be achieved subject to loss activity,” the September 2010 report reads.Moderate increases in cat cover are expected, primarily due to the full consideration of the increase probable maximum loss (PML) produced by RMS v9. Casualty pricing is anticipated to remain firm and capacity adequate, with stable pricing contributing to constant client retention levels.