A report from Gallagher Re offers welcome news for the reinsurance sector, and a potentially positive trickle-down effect for the rest of the industry and its customers, says Heather Bone, CEO of Gallagher Re Australia and New Zealand.

Near-record returns were achieved in reinsurance throughout 2023, says Gallagher Re’s 1st View report, with many achieving a return on equity exceeding 20 per cent.

And the good news isn’t just in the past, the report says. The first quarter of 2024 has shown a 12 per cent improvement in combined loss ratios.

“Non-life Insurance-Linked Securities capital reached a record level US$107 billion at year-end 2023 and continued to grow in H1 2024, driven by successful catastrophe (cat) bonds and increased investor interest,” the report said.

Property lines were more competitive, with buyers of property catastrophe insurance able to negotiate better terms and conditions on their reinsurance contracts due to the risk-on approach taken by reinsurers.

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