January 2025 Reinsurance Renewals: A Mixed Bag
Following a varied pricing landscape at the January 1st, 2025, reinsurance renewals, influenced significantly by Hurricanes Helene and Milton alongside the expensive California wildfires, experts at Moody’s project a stabilization in property cat reinsurance pricing during the upcoming US-centric mid-year renewal period.
European Reinsurers’ Performance
Moody’s recent note highlights updates from several reinsurance brokers and European carriers regarding their experiences at the 1.1 2025 renewals. Notably, this period sees between 40% and 60% of a global reinsurer’s portfolio renewed, encompassing a substantial portion of European business.
Among the major four European reinsurers, all except Munich Re (whose decline was attributed to strategic underwriting decisions) experienced premium growth at the start of the year. This growth occurred as companies sought to allocate capital in a still-appealing pricing environment, though it was slightly less robust compared to the 1.1 2024 renewals.
Pricing Trends
Pricing across these European reinsurers’ portfolios was largely steady, with Hannover Re recording a 2.1% decrease, while Swiss Re noted a 2.8% overall increase. SCOR, for its non-proportional business, reported its first pricing drop (-0.8%) since the January 2017 renewals.
US Property Catastrophe Reinsurance: Rate Decline Observed
According to reinsurance broker Guy Carpenter, the pivotal US property catastrophe reinsurance segment experienced a 6.2% rate decline at 1.1 2025, marking the first drop since 2017.
Moody’s notes that pricing remained fairly consistent in working layers—those lower levels of reinsurance designed for frequent, smaller claims. However, pricing saw reductions at the top tiers of reinsurance programs where ample capacity existed for coverage of infrequent, larger claims, maintaining their attractiveness on a risk-adjusted basis.
Focus Shifts to Mid-Year Renewals
Attention now turns to the mid-year reinsurance renewals, which are significantly concentrated on the US, a region recently beset by substantial loss events.
Impact of Recent Catastrophes
According to Moody’s, the upcoming midyear 2025 reinsurance renewals will be heavily influenced by major US catastrophe loss events over the past year, notably Hurricanes Helene and Milton, along with the Los Angeles wildfires. These events are poised to bolster reinsurance pricing for US exposures.
Moody’s adds that many US accounts up for renewal have incurred losses from these significant events, making it likely that US property catastrophe reinsurance pricing will stabilize. This stabilization is anticipated to be supported by potential price hikes for accounts that have suffered considerable losses over the past year.
