Market Overview and Dynamics
In Japan, the Casualty General Third Party Liability (GTPL) reinsurance market for the April 1st, 2025, renewals presented significant challenges. Excess-of-loss programs that did not experience any loss emergence saw rate adjustments ranging from flat to up 5%, according to the insights from reinsurance broker Gallagher Re.
Efforts and Impacts
Notably, cedents’ substantial efforts to curtail U.S. exposure, alongside improvements in certain individual claims, contributed to potential modest reductions in prices. Reinsurers held diverse perspectives regarding pricing adequacy, largely influenced by how exposure reductions and loss histories were credited.
Reinsurer Caution and Capacity
Gallagher Re highlighted, “While caution among reinsurers persists regarding the remaining U.S. exposures, there was a general increase in the willingness to support with additional ‘strategic’ capacity, aimed at accessing other lines of business.” Consequently, programs were comfortably placed, with incumbent reinsurers largely maintaining their capacity, while a few new entrants also participated.
Personal Accident Market Trends
Within the Personal Accident sector in Japan, rates experienced a decrease from 15% to flat. Gallagher Re explained that the market has reverted to pre-2022 COVID-19 loss levels, leading to an oversupply of capacity. Insurers were able to issue orders achieving meaningful risk-adjusted reductions without affecting their written shares.
The report further stated, “Most buyers renewed without making significant structural changes, having already achieved the desired adjustments in the previous renewal. Although some buyers sought to enhance Communicable Disease coverage, the primary focus remained on achieving risk-adjusted savings.”
U.S. General Third Party Liability Observations
For the United States General Third Party Liability, rates ranged from down 5% to up 5%. Gallagher Re noted the overall stability in capacity for U.S. Casualty. Although individual reinsurers’ appetites shifted slightly, there was less turnover in panels during the late Q1 and early Q2 U.S. Liability renewals.
“Pricing and individual program appetite remain sensitive to carriers’ performance trends and dynamics. Those carriers who provided detailed data and evidence-based arguments and analysis of underwriting and claims actions managed to secure favorable year-on-year pricing outcomes, preserve capacity, and strengthen reinsurer relationships,” Gallagher Re elaborated.
“Carriers who articulated a comprehensive strategy, supported by data and analytical evidence, to navigate ongoing market complexities were able to attract greater capacity from their incumbent reinsurer panels and interest from new markets, as reinsurers seek to expand with ‘best in class’ carriers.”
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