U.S. RE Offers Greater Capacity in Tightening Reinsurance Market and New Programs
U.S. RE is responding to the tightening reinsurance market by offering increased limits and greater capacity along with the Company's specialized catastrophe products, reports Joe Fedor, Executive Vice President.
"We're also developing niche reinsurance products working with program managers AMG/Quadrant and our new subsidiary, Uni-Ter Underwriting Management Corporation," Mr. Fedor said.
"We've found that in certain situations a reinsurance commitment is the key to closing a program deal," according to Mr. Fedor. "Our Senior Vice President Larry Shatoff and his team work with program managers to provide reinsurance support," Mr. Fedor explained.
As for the near-term outlook, he expects continued hardening. "The retrocessional market is becoming extremely pricey and choosy. Reinsurers are increasingly selective in making retro deals. They're focusing on relationships. Retro providers today are not just money driven. They're looking for long-term partners," according to Mr. Fedor.
Although the primary reinsurance market is firming, Mr. Fedor believes that in the absence of major catastrophes, competition will keep price hikes in a reasonable range. He noted that many insurers are increasing retentions to offset rate increases. Mr. Fedor also foresees continued consolidation in the reinsurance industry as reinsurers opt to grow by acquiring books of business through merger and acquisition activity.