The reinsurance market cycle has become more subdued thanks to sound risk management practices, strategic use of technology and a maturing partnership with alternative capital (ILS), according to rating agency AM Best.
Commenting this morning on the fact reinsurance firms met their costs of capital for the second year in a row in 2024, AM Best highlights the maturing relationship between traditional and alternative or insurance-linked securities (ILS) capital as helping to drive a less volatile market cycle.
It’s all about adopting flexible strategies that allow reinsurance companies to manage their risk appetite through the cycle, while delivering on client promises and expectations, weighing opportunity with the need to be disciplined and embracing modernisation, alongside efficient capital, to deliver above cost-of-capital returns through the cycle, AM Best’s latest report suggests.
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