One of the most striking features of the tightening reinsurance market over the past 18 months has been its lack of new entrants. Past phases of market hardening have often been defined by start-up reinsurers coming onto the scene, yet the 2023-2024 hard market, the strongest and most synchronized since 2001, has not fit this pattern.
In this piece, Brian Shea and William Dubinsky explore this phenomenon and reach several insights about the 2023-2024 reinsurance hard market.
Key Findings:
- We identify four reasons for the lack of new entrants over the past 18 months.
- With the possible exception of start-ups focused on casualty, we don’t see that changing.
- In the meantime, new capital has been entering the alternative capital space, with record cat bond issuance in 2023 and likely again in 2024.
- Moreover, despite a lack of new entrants, reinsurance supply has become more diversified.
- The bottom line is that the reinsurance market has ample and well-diversified supply, and reinsurance buyers have the ability to flex nimbly across different sources of capital.
Read the paper to learn more.
