The reinsurance market is gearing up for the Rendez-Vous de Septembre conference in Monte Carlo where key players will gather for discussions ahead of the upcoming renewal season. At a press conference ahead of Monte Carlo, Dean Klisura (pictured), chairman and CEO of reinsurance brokerage giant Guy Carpenter, highlighted a number of key topics he expects to discuss with clients and reinsurers alike at the upcoming conference.

“There are a number of key messages that come with that,” he said. “I think the first message is that the market has ample capacity. Reinsurers are motivated to see their clients and do business in Monte Carlo. People in the market have described it as a balance with clients and reinsurers being very engaged this weekend.

“All of our clients will be participating in these renewal discussions, hoping to differentiate themselves from their major peers in the market and really leverage their strategic business relationships with reinsurers, in terms of portfolio management and risk mitigation, across their portfolios. I think the reinsurance markets really offer a tailored and disciplined approach to each distinct renewal.”

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Key Factors Influencing Today’s Reinsurance Market

Klisura said it’s important to keep in mind that despite much written concern and discussion about U.S. incidents, many reinsurers in the market are open and eager to work 1/1 and want to grow their portfolios. Outlining some of the key factors impacting the market today, he noted that there are both headwinds and tailwinds impacting Guy Carpenter’s clients.

Starting with the headwinds, he pointed to the continued geopolitical volatility we are seeing around the world, and the continued economic and social inflation. Economic inflation appears to be easing somewhat, as the market continues to see downward pressure on interest rates this fall.

“There is ongoing macroeconomic uncertainty, and global losses have accelerated in the first half of the year… This could be another $100 billion market loss year. I’m sure many of you saw the Verisk study this week, which projects future market losses of over $150 billion per year. Of course, a lot of this is dependent on or attributable to the acceleration of climate change affecting our clients,” he said.

What are the favorable factors that serve the interests of clients in today’s reinsurance market?

In addition to these headwinds, there are also a variety of tailwinds that benefit Guy Carpenter’s clients in the market and its trading partners. The reinsurance market remains very strong and well-funded, Klisura said. “For the first time in probably three years, we are seeing new startups emerge and new capital being discussed to enter the market in 2025.

“Reinsurance returns on equity remain very strong. So reinsurers want to hold their positions, want to be disciplined, want to write more business as we head into 2025. But we expect the underwriting market to continue to be tight.”

The mood among reinsurance CEOs is that reinsurers are looking to maintain their position and their bottom line, and keep the structures, the tie-ups, the terms and conditions the same – which produces a very healthy return on investment for these companies. “So it’s going to be a tough conference for our clients, to try to make some progress in these discussions,” Klisura said.

There is also a continued focus on product innovation in the market. There are a lot of interesting discussions taking place around the future of parametric insurance in terms of parametric triggers and parametric products. “Every day you read about new cyber innovations, and our team will be in Monte Carlo to really talk to our clients about innovations in the cyber market,” said Klisura.

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