April reinsurance renewals saw significant price drops, and June renewals could see double-digit drops for Florida property-catastrophe risk, according to Fitch Ratings.
"The price declines, along with more generous policy terms and conditions, result from recent low catastrophe losses and continued abundant reinsurance capacity from both traditional reinsurance and the growing alternative capital market," Fitch says in a statement.
Fitch notes that June sees an abundance of Florida property-catastrophe risk renewals. "Florida property is among the most widely modeled catastrophe risks and is therefore the area of focus for third-party capital," Fitch says. "Consequently it has experienced the most reinsurance pricing pressure and we expect competition between traditional and non-traditional reinsurers to remain fierce this year."
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