Rates

The property direct and facultative market achieved rate increases of 20-30 percent on loss-hit US business at the April renewal, but underwriters were still nonetheless disappointed.

Reinsurers were pushed back in their attempts to increase US property rates at the April renewal, with loss-free cedants even demanding slight decreases, Willis Re said in its 1st View report.

Cat bond volumes rose to $3.48bn in the first quarter, as diversifying non-US deals bolstered issuance.

Several Florida cat bonds among new second quarter ILS transactions have set tight pricing precedents that will undoubtedly be used by insurers to try to keep a lid on rate movements in the upcoming mid-year renewals.

UPC's Armor Re II cat bond has priced 17.7 percent below the midpoint of the initial spread guidance at 350 basis points (bps).

Allstate's Sanders Re 2018-1 cat bond has expanded by 25 percent to $500mn, as pricing dropped to 550 basis points, the lower boundary of the initial guidance range.

The Texas Windstorm Insurance Association will reset its Alamo Re 2017 cat bond to trigger at a lower level after its Hurricane Harvey losses wiped out the association's funds.

The cat bond market has gained some much-needed diversification following the launch of three Japanese deals, including a $700mn transaction.

Several Floridian insurers are looking to lower their reliance on the state-backed reinsurance fund in 2018, bringing a small amount of new demand into the market.

Reinsurance buying strategies are likely to diverge ahead of the June renewals as some cedants attempt to agree capacity early and others sit tight in the hope of striking a better deal later on, sister publication The Insurance Insider has reported.

The abundance of ILS and traditional capital is reducing the likelihood of a sustained rate hardening in catastrophe-exposed US insurance business, Willis Towers Watson has said in its update on the US property market.

ILS spreads have widened in the mid-to-high teens range after last year's losses, Swiss Re Capital Markets estimated in its latest quarterly market report.