With alternative capital in the reinsurance industry standing at a record $113 billion in 2024, analysts at S&P Global Ratings projects that it will continue to reach new heights in 2025, as it fills gaps left by traditional capital.
According to insurance and reinsurance broking group, Aon, global reinsurance capital reached an all-time high of $715 billion on September 30th 2024, which represents a $45 billion, or 6.7% increase from year-end 2023.
This also represents a substantial increase from 2022, where global reinsurance capital sat at $575 billion, which included a $93 billion contribution from alternative capital.
In a recent report, S&P notes that 2024’s growth was primarily driven by strong retained earnings, unrealised gains on fixed-income securities, and recovering asset values benefiting from declining interest rates.
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