The property reinsurance pricing on loss free risk and CAT programmes in ASEAN and China varies from +15% to +20% risk adjusted, and even larger increases are seen in Taiwan and Korea, as per the”1st View Market Report” released on 1 January.
The report, outlining market conditions at key reinsurance renewal seasons—1 January, 1 April and 1 July—which are based on the real-time observations, also says that there has been an inconsistent application of deductible increases, primarily imposed on loss impacted placements.
Other findings were:
• A common feature is all peril coverage and wordings in existing hours clause have been largely maintained.
• Hardly ever, shortfall terms have been imposed on proportional and excess of loss contracts.
• Limited changes in proportional placements renewal; commissions changed by low single digits. However, there was limited additional capacity.
• Regional Retro deductibles increased substantially (mostly dropping first layers) and pricing was up across the board, however, access remained to worldwide capacity and coverage.
• Risk covers with existing CAT coverage were renewed with no additional restrictions.
• Pre-paid reinstatements shifted to paid for both risk and CAT contracts.
The January 2023 report indicates the conditions in specific markets in Asia, including:
• Loss participation clauses are now commonly in place – most triggered at 100% loss ratio with cedant participation between 30% and 50%.
• Excess of loss pricing increased and was dependent on loss record.
• Overall, deductibles remained unchanged although some cedants chose to have them increased to manage costs.