Posted on 10 Feb 2012
Scor SE said its property/casualty reinsurance segment saw an 8.8% rise in gross written premiums at January renewals, compared with the previous year, confirming what the reinsurer sees as "continuing" recovery in the insurance and reinsurance markets.
Premiums rose to 3.98 billion euros (US$5.28 billion) for Scor Global P&C. Property/casualty treaty premiums rose 12%, and specialty treaty business rose 18%.
According to Scor, 70% of its nonlife treaties were up for renewal in January. Proportional motor business, notably in the United Kingdom, China and the Netherlands,"is experiencing particularly strong growth," the reinsurer said.
Scor added the geographical diversification of business has increased, with the Americas now representing 21% of premiums and Asia representing 11%.
For specialty treaty, 56% of Scor's business came up for renewal in January. The reinsurer's taking up a strategic position in aviation insurance contributed eight percentage points to growth.
Pricing in lines exposed to economic uncertainties, including credit, construction/erection all risks and marine, "remains particularly prudent," Scor said.
Among the trends identified during Jan. 1 renewals, Scor said technical profitability is stable, as measured by the combined ratio and the remuneration of allocated capital, "and rests on prudent projections, particularly for those business lines most exposed to economic uncertainties." The reinsurers said terms and conditions remain largely unchanged, except for contracts and regions hit by 2011 natural catastrophes.
Also, "there is a higher level of differentiation between cedants within a given market, and the markets themselves remain fragmented, in accordance with the scenario that Scor has been putting forward for several years," the reinsurer said.
The reinsurer added that 2011's natural catastrophes mainly affected the Asia-Pacific region, where Scor saw prices rise 29.9% for natural catastrophe business at Jan. 1. Scor said it decided to leave its exposure unchanged in the countries affected.
Scor said it continues to "re-balance" its portfolio by moving more exposure into U.S. natural catastrophe risks, where pricing is up 13.2%, compared with an increase of 4.6% in Europe.
"In the short and medium term, the upward price trend should continue, although 60% of the Asia-Pacific region portfolio will be up for renewal in April," said Scor. "In the current environment, Scor Global P&C estimates that its gross written premiums should reach 4.5 billion euros in 2012."
Among other loss events in the Asia-Pacific region last year, Scor said recent floods in Thailand will bring it losses of about 140 million euros, net of retrocession and before tax, with most of the claims related to manufacturing and supply chains losses.
The reinsurer added that Jan. 1 results are on track for the group to meet its target of 9% organic growth a year.