The rating environment is still not supporting significant growth in marine classes, according to Axis Re’s president of global markets, Ann Haugh.
While marine cargo exposures are seeing double-digit rate increases, Haugh said other exposures, such as global energy, marine liability and marine hull, are seeing increases that remain in the single digits.
“That is the one area we still have to be prudent – the rating environment is not supporting significant growth,” she said.
“Rate increase on some lines have been very layer specific for loss-impacted business,” she said. “Although as we move into the 1.1 renewal season, there is more of a general sense of the need for rate rather than just loss-impacted rate need.”
For aviation, Haugh said the market hardening which began at the end of last year is still continuing at pace. “We expect solid double digit increases into 2021,” she said.
Haugh said she was “cautiously optimistic” that trade credit rates will start to move.
“We knew it would be a bit of a wait and see game in terms of Covid-19 impacts. We have no claims in but clearly insolvencies likely to pick up in the fourth quarter and into 2021,” Haugh said.
For US mortgage insurance, Haugh said margins were now starting to contract following an earlier improvement driven by the pandemic.
“That market saw significant rate increase in the early stages of Covid-19. Those impacts peaked in April, May and June but are now starting to subside as the crisis seems manageable from a housing market perspective.
“There has been strong government support, with forbearance programmes mitigating some of the losses,” she said.
“We are starting to see the margins on some of that business contract as pressures come back in. It feels like this may have been a 2020 growth opportunity rather than a 2021 growth opportunity.”
Watch “Reinsurance in a time of Covid-19” in full:
- Vivek Bajaj, Managing Director, Europe & Asia-Pacific, RMS
- Jean-Paul Conoscente, CEO, SCOR Global P&C
- Ann Haugh, President, Global Markets, Axis Re
- Jason Howard, CEO, Beach and Associates
- Rupert Swallow, CEO, Capsicum Re (which will trade as Gallagher Re from 01 October 2020)
- Sophie Roberts, content editor, The Insurer (Moderator)