Here in Monte Carlo cedants are playing hardball.
In fact they're not just playing hardball - they've swallowed the ball and now they're starting to gnaw through the bat. Some of the more desirable ones have gone for a massive swing on the first pitch, hoping to hit one clean out of the park.
But to reinsurers' credit, so far the invitation to be negatively arbitraged with multi-year, blind-follow whole-account deals has been met with incredulity and polite resistance.
But now here comes the second big swing - some cedants are calling reinsurers' bluff and setting up their own internal reinsurance vehicles.
The clear message is that if you won't write it that way, we will. Thus reinsurers are getting hit from all sides. Now it's not just the cloud of ILS practitioners that is making away with the highest margin business, it the customers themselves that are making financial hay on the back of reinsurers.
The brokers aren't too happy either as one way or another, this is going to end up spoiling their game plan too. At first this wild second swing from the buyers doesn't make sense.
After all, why would anyone retain something their hungry soft market reinsurers have already declined? Why now, when reinsurers are so pliant and in such an equitable mood?
Are these players suffering a rush of blood? Don't they like the service they are getting from their long-term supporters? But the gambit soon makes sense when you think harder about it.
Insurers are experiencing a favourable double boost. Their business is still technically sound and its US portion has even benefited from some decent pricing over the past couple of years, while at the same time reinsurance costs have been falling fast.
Under such circumstances some reinsurers might go along with the negative arbitrage and hand cedants a free capital cushion for the next few years - it's worth a try just to see if anyone blinks. But if they don't the internal reinsurance vehicle still makes sense.
Before global insurance pricing turns negative, why not save up the last of the feast from the decently profitable years for the inevitable famine that is to follow?
What's more these vehicles inevitably exist offshore, so the players are keeping a share of profits out of the reach of the taxman's grasping hands.
And it's doing business with someone you know and trust. A vehicle should always pay claims even if no one else does - none too shabby if it's writing a major percent share of the book.
If the cedant is big enough it will have a very decent and diversified spread of business to play with. And apart from the obvious fiscal advantages there might also be the opportunity to get this capital to even work harder by loading on a bit more investment risk than the regulator would allow to be taken onshore.
Think of it as a giant tax-free piggy bank that you can fill up with premiums for when you might need them. And if the market softens even further and some reinsurers capitulate, who's to say a big proportional retro might not be ceded out of such a vehicle on exceptionally favourable terms at a future date?
The cedants have got reinsurers in a bind - they're just waiting for someone to lob them an easy pitch.
Look out in the stands - the ball is fast heading in your direction...
To view our fourth Monte Carlo daily please click here
Mark Geoghegan
Editor, The Insurance Insider