However, challenges are emerging, including rising physical risks, a slower economic outlook, and still costly retrocession cover, which may increase margin volatility, cautioned the report
HONG KONG: Asia-Pacific continues to present an attractive growth narrative, facilitating sustained reinsurance capacity, according to “Asia-Pacific Reinsurance Sector Update: Improvements Are Underway” published by S&P Global Ratings on Wednesday.
“We expect easing premium rates and organic demand to drive the pace of topline growth. Rated Asia-Pacific reinsurers are poised to experience stable credit trends, backed by earnings and capitalization,” said S&P.
However, challenges are emerging, including rising physical risks, a slower economic outlook, and still costly retrocession cover, which may increase margin volatility, cautioned the report.
Additionally, softer investment returns as monetary policy eases necessitate heightened underwriting discipline. Unexpected insurance claims and capital market fluctuations could weigh on capital strength, highlighted the report.