Reinsurance capital is set to increase again in 2024

Global reinsurance committed capital is expected to grow more than 9% by the end of 2024 to $620 billion and $625 billion, according to a report by AM Best Co. Inc., published Friday.

Traditional reinsurance capital is expected to increase by 10%, and third-party capital, which includes insurance-related securities, is expected to increase between 5% and 10%.

This follows a 7.2% increase in global reinsurance capital in 2023, including a 13.9% increase in traditional capital, according to Best.

Reinsurers’ earnings improved last year as some companies exited the catastrophe reinsurance market due to poor results and remaining reinsurers raised rates, Best said.

“The absence of start-up reinsurers has allowed traditional reinsurers to maintain their market shares without compensating with mitigating terms. The property reinsurance market stabilized in the first half of 2024 and even softened slightly at the highest attachment points,” the report said.