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Hannover Re expects nat cat pricing to soften at 2027 renewals
The reinsurer said it is prepared to add capacity, while warning that property and casualty reinsurance faces intensifying competition and higher uncertainty driven by geopolitics, inflation, digital threats, and climate-related risks.
Hannover Re said natural catastrophe reinsurance pricing remains technically risk adequate, but it expects rates will likely soften at renewals in 2027. Speaking at the Monte Carlo Rendez-vous, the global reinsurer also said it is prepared to make additional capacity available.
The company described an increasingly challenging property and casualty reinsurance environment, citing growing uncertainties and intensifying competition that it said are creating headwinds for the industry. It attributed the harder underwriting landscape to geopolitical tensions, inflation, digital threats, and climate-related risks that make it more difficult to assess long-term claim costs and set risk-appropriate pricing.
Hannover Re said high-quality reinsurance capacity remains in demand even as capital supply continues to increase across the sector. It added that, for January 2027 renewals, it anticipates largely risk-adequate pricing across P&C reinsurance, with terms and conditions likely broadly unchanged even if prices are slightly lower.
For property catastrophe reinsurance, the reinsurer noted higher competition and price pressure, while saying terms and conditions in the main are largely stable. It also stated it plans to make at least stable reinsurance capacities available for the renewals, contingent on obtaining risk-adequate prices, and said it sees demand for natural catastrophe risks as solid and expected to keep growing.