Global reinsurer SCOR said today that it grew its January reinsurance renewal portfolio by almost 16%, in terms of premiums, while prices were up by 7.8% across its renewed business, at 1/1 2021.
The company said that the reinsurance treaty market “hardened significantly” and that price increases and better terms and conditions were experienced across all lines of business and all regions.
Leading SCOR to take full advantage and grow its renewal book significantly, while also securing what it calls “preferential terms” in many cases, particularly in areas such as pandemic exclusions.
While reinsurance rates were impressive, SCOR notes that specialty insurance, another area of recent expansion for the firm, saw even sharper rate increases, with SCOR Global P&C achieving gross premium growth of 16% in 2020, with 23% rate increases for large commercial lines business.
SCOR expects a “significant improvement in the technical profitability of the book” which the reinsurer says will “translate into our results progressively in the quarters to come.”
Positively, SCOR says that it expects hardening reinsurance market trends will persist and be seen at all future renewals through 2021 and also 2022, the longest and most bullish such forecast yet seen.
“The Group is well positioned to take full advantage of these trends in both insurance and reinsurance, leveraging on its global underwriting platform,” the company explained.
The January 2021 reinsurance renewals saw a “strong acceleration” of P&C market hardening caused by the previous years of high natural catastrophe losses, attritional social inflationary factors, and low interest rates.
While, on the demand side the need for reinsurance was robust, driven by increased general risk aversion, SCOR explained.
SCOR said that it actively steered its portfolio towards the areas of its business where the most attractive rates and conditions were to be found.
In global reinsurance treaty lines SCOR actually grew its renewal book by an impressive 26.4%, compared to 12.2% growth in treaty P&C reinsurance lines.
Like all underwriters, SCOR now feels it sits on a book with much higher technical profitability, something that will only be borne out through the year and dependent on loss activity, of course.
“SCOR believes the current buoyant market cycle will be sustained in 2021 and 2022,” the company reiterated, as it displayed a level of confidence on market conditions that is perhaps not as widely held.
For the upcoming April and June / July 2021 reinsurance renewals, SCOR said that it expects the market will “show further price increases and improved terms and conditions.”
Jean-Paul Conoscente, CEO of SCOR Global P&C, commented on the renewals, “The January 2021 renewals have shown a significant acceleration of market hardening for P&C reinsurance. In this supportive market environment, we fully leveraged our positioning and deep client relationships to achieve strong profitable growth, marked by a sizeable improvement of the profitability of our book across all regions and lines.
“Looking forward to future renewals, we are confident that price increases and improvements in terms and conditions will continue. We confirm the growth and profitability assumptions set for 2021 at SCOR’s September 2020 Investor day, which have been revised upwards since the launch of our “Quantum Leap” plan.”