Tracy Benguiat

Tracy Benguiat posed a macro question, asking for an educated guess on how much reinsurance dedicated capital (out of approximately $800 billion) would need to exit the industry to achieve equilibrium, given that supply currently outweighs demand. She also asked how the trend of property business being underwritten, shared, and layered (rather than through facultative reinsurance) impacts RenaissanceRe's opportunity set and relative pricing.

Answer

President and CEO Kevin O'Donnell suggested that the market is relatively close to balance, indicated by the forecast 10% rate reduction, and doesn't believe a specific 'X billion dollars' needs to leave the market. He emphasized that it's more about the perception of risk and comfort level for deployment. EVP and Chief Underwriting Officer David Marra explained that the shared and layered business, particularly cat-exposed E&S, is seeing increased competition but is a minority portion of their book. He noted that favorable development from strong terms and conditions supports the book's performance.

Tracy Benguiat posed a macro question, asking for an educated guess on how much reinsurance dedicated capital (out of approximately $800 billion) would need to exit the industry to achieve equilibrium, given that supply currently outweighs demand. She also asked how the trend of property business being underwritten, shared, and layered (rather than through facultative reinsurance) impacts RenaissanceRe's opportunity set and relative pricing.

Answer

President and CEO Kevin O'Donnell suggested that the market is relatively close to balance, indicated by the forecast 10% rate reduction, and doesn't believe a specific 'X billion dollars' needs to leave the market. He emphasized that it's more about the perception of risk and comfort level for deployment. EVP and Chief Underwriting Officer David Marra explained that the shared and layered business, particularly cat-exposed E&S, is seeing increased competition but is a minority portion of their book. He noted that favorable development from strong terms and conditions supports the book's performance.