Reinsurance clients are “really focused” on who they are buying coverage from, said Doucette, who serves Everest Re as president and CEO of its reinsurance business.

“They want to deal with large, global highly-rated reinsurers that can deploy capacity all over the world,” the executive told The Insurer.

Doucette said this trend is an “overarching” theme of the market at present, and one that he and his colleagues believe will continue into 2021 and beyond.

At the same time, Doucette said buyers were also increasingly turning to the “traditional reinsurance model” for support.

“A lot of that has to do with the trapped collateral and some of the headaches of collateral release mechanisms,” the executive explained.

“We continue to [think] those themes will be very pronounced going into January 1,” Doucette said.

The issue of trapped collateralised capital will also have a major bearing on retrocession renewals heading into 2021, Doucette said.

Collateralised capital has grown to now represent some 70 percent of the retro market, Doucette said, and there will be challenges for buyers if even more of that is trapped by the losses that have arisen this year such as Covid-19, the California wildfires and recent US hurricanes.

“We’re seeing [those challenges] right now,” Doucette said, although these issues play into the hands of Everest Re, as the company is both a major player in the reinsurance and retro markets.

“The bottom line is we’re optimistic heading into January 1,” Doucette said, with rates increasing across many of the business lines it operates in.

“We certainly expect to see a continuing improving market and a market that is trending more towards the sellers rather than the buyers as it has for the last year,” Doucette said of the reinsurance market.

And as a seller of retro capacity, Doucette is similarly encouraged at what lies ahead.

“We’re one of the top three or two rated reinsurers that sell retro. We’ve been doing it for many years and have a great franchise and great group of clients,” Doucette said.

“If rates are going up we will have the capacity at our price, terms and conditions, [and] we’ll have capacity, and potentially more capacity, to deploy into the retro space,” he explained.

Everest Re is itself also a buyer of retro, but Doucette said the company does not have to rely on that specific market to manage its capital position as the company has other tools at its disposal such as its suite of Kilimanjaro catastrophe bonds, its alternative capital platform Mt Logan Re and also potentially industry loss warranties.

“The catastrophe bonds, Mt Logan, the reinsurance that we buy, [and the] ILWs…allow us to put in place something that’s very robust and allows us to continue to offer to our clients sustainable, consistent capacity,” Doucette explained.

“We’re net a long seller, and we will continue to be in that position going forward and we look forward to helping our retro clients solve their risk transfer needs into 2021 as we have done over the last 25 years as a public company and the last 48 years in the history of our company,” he added.