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Munich Re cuts retrocession and says it has no current cat bond
The reinsurer also let its last in-force catastrophe bond under the Queen Street program mature without renewal, while its Solvency II ratio has moved above 300%.
Munich Re has reduced its retrocessional protection and is relying more on its own underwriting, its CFO said during an earnings call, explaining that the company puts effort into underwriting to keep the risk and warehouse it. The approach supports retaining more of the economics of its reinsurance business, though it also means major loss events could have a larger impact with less external protection.
The insurer previously signaled the shift by slashing retrocession arrangements and scrapping a collateralized reinsurance sidecar program. Artemis reported that Munich Re’s half-year results show significantly lower ceded revenues for the second quarter of 2026, indicating reduced reliance on retrocession.
On catastrophe bonds, the CFO said Munich Re does not currently have a cat bond in issue, after allowing its last in-force catastrophe bond under the Queen Street program to mature without renewal. The company also referenced earlier reports of some investors declining allocations to its sidecar.
Munich Re said it is prepared to retain the risks it writes, citing a Solvency II ratio above 300% and capacity to warehouse risks. The CFO added that, with catastrophe reinsurance rates still adequate, the company is “quite happy” to retain risk and earn the full profit margin itself rather than ceding profits to other parties, according to Artemis.