Scor has used its Monte Carlo Rendez-Vous press conference to set out an expectation of reinsurance rate increases in the low double digits for 2024.
P&C CEO Jean-Paul Conoscente said he anticipates price increases across all lines and geographies next year.
Conoscente noted that, despite a “big shift” in property cat pricing in 2023, cat activity has been “sustained” in H1, albeit with more of the burden now falling on cedants given recent increases in reinsurance programme retentions.
“For us to be a long-term reinsurer, we need more than one profitable semester,” Conoscente said, adding that reinsurers’ returns on equity still barely cover their cost of capital.
He said that, in particular, pricing must rise further in US casualty and property cat business – while on property insurance, he was not confident that cedants are yet charging the “true” price for their product.
The firm estimated that risk-adjusted P&C reinsurance rates were up by 5% in 2023 renewals, in presentations delivered at its investor day ahead of Monte Carlo.
Scor’s programme of reinsurance portfolio remediation has been well documented and, while Conoscente emphasised that much progress had been made, especially in cat, the carrier will “remain highly vigilant” in some lines of business.
In particular, Conoscente said Scor is wary of developing loss trends in strikes, riots and civil commotion coverage and of the increase in subsidence caused by drought in European countries.
Speaking at the same event, Scor’s new CEO Thierry Léger said that, in general, demand for reinsurance is on the rise.
“Scor is well placed and will create value,” Léger said, emphasising messaging delivered last week in the publication of Scor’s new three-year strategy, ‘Forward 2026’.
Léger also said Scor expects some industry insured losses to arise from the 6.8 magnitude earthquake that struck central Morocco, including Marrakesh, on Friday, claiming at least 2,000 lives.
Conoscente clarified though that the gap between the economic and insured losses from the quake will be large due to relatively low insurance penetration in the country.
