2023 - 2024

Market Snapshot

Global Reinsurance Market 2024: Challenging Renewals & Realignment

The 2023 Global Insurance Market Report (GIMAR) shares the outcomes of the 2023 Global Monitoring Exercise (GME), the International Association of Insurance Supervisors’ (IAIS’) risk assessment framework to monitor key risks and trends and detect the potential build-up of systemic risk in the global insurance sector.

IAIS - International Associations of Insurance Supervisors
December 2023

Reinsurance Report Highlights

From 2003 to 2019, the IAIS collected data on the global reinsurance market through its annual Global Reinsurance Market Survey (GRMS). The GRMS covered about 50 reinsurers based in nine jurisdictions: Bermuda, France, Germany, Japan, Luxembourg, Spain, Switzerland, the UK and the US. The GRMS collected data from reinsurers with gross unaffiliated reinsurance premiums of more than $800 million or unaffiliated gross technical provisions of more than $2 billion. The pool of participating reinsurers remained largely the same throughout this period.

Reported gross reinsurance premiums continued the growth trajectory
of recent years to increase by almost 10% in 2022.

Source: IAIS SWM 2023 (GRMS + SWM reinsurance component)

As can be seen in the above Figure, reported gross reinsurance premiums continued the growth trajectory of recent years to increase by almost 10% in 2022. Sample controls are applied, ie data was only taken from jurisdictions that provided consistent data across all years (YE19-YE22). This is a materially different trend to the one reported for the global insurance market (covering both primary and reinsurance markets) which saw a slight decrease of 0.3% in GWP in the SWM 2023. Reinsurance market growth can also be observed in net premiums.

Net reinsurance premiums continued the growth trajectory
of recent years to increase by almost 12% in 2022.

Source: IAIS SWM 2023 (GRMS + SWM reinsurance component)

As can be seen in above Figure (net reinsurance premiums), the increase in net reinsurance written premiums reported for 2022 was more than 12%, after strong growth in 2022 as well.

Regional view

Net and Gross reinsurance premiums (YE19–YE22)

Source: IAIS SWM 2023 (GRMS + SWM reinsurance component)

As shown above, regional developments in gross and net reinsurance premiums, based on SWM data. The 2022 increase in net reinsurance premiums was driven mainly by the Europe region. However, all regions experienced growth in both gross and net reinsurance premiums.

The IAIS also monitors the size of the global insurance and reinsurance market, in particular the share of reinsurance in the global insurance market. For the purpose of this monitoring, the global insurance market estimate covers both direct insurance and reinsurance premiums, whereas the reinsurance market estimate covers reinsurance premiums only.

In 2022, the global gross insurance market covered by the SWM data was approximately $6.975 trillion, with approximately 46% located in the Americas region. The size of the global gross reinsurance market covered by the SWM was approximately $809 billion, with approximately 46% located in the Americas. In total, reinsurance accounts
for about 12% of all global gross insurance
premiums covered by the SWM (see Figure below).

Source: IAIS SWM 2023 (GRMS + SWM reinsurance component)

Source: IAIS SWM 2023 (GRMS + SWM reinsurance component)

IAIS report here illustrates the regional split of reinsurance asset allocations, based on the reinsurance data collections. The distribution is roughly similar across regions. The key asset classes are corporate bonds (23%) and equities (20%) in all regions. The largest relative shares of asset allocations to sovereign debt securities are in the Europe and Africa regions. Reinsurers in the Americas region also have material investment exposures to securitisations, in contrast with other regions. Overall, reinsurers hold limited investments in loans and mortgages and real estate. In comparison to the insurance market, the following main differences at the year-end 2022 were identified:

> Higher shares of equities (20% of reinsurers’ total assets, compared to 11% of insurers’ total assets)

> Lower shares of sovereign debt (7% compared with 22%)

> Lower shares of loans and mortgages (3% compared with 6%)

> Lower shares of real estate assets (0.4% compared with 2%)

arb - Aphrodite Reinsurance Broker FZCO

arb - Aphrodite Reinsurance Broker 
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