Reinsurance: low rates expected at the next renewal

According to Standard & Poor's (S & P), the rate decrease observed during recent years is expected to continue in 2017. The rating agency believes that low prices could reach up to 5%.

As in past years, this situation is attributable to the combination of four factors: the absence of a major loss, competition, overcapacity and low financial returns.

The combined ratio expected in 2016 ranging between 97% and 102% may also deteriorate in 2017 between 100% and 104%. The return on equity (ROE) would, in turn, vary between 7% and 9% against an average of 10% in recent years.
The sector remains dominated by ten reinsurers which account, alone for 74% of the global premiums in 2015.Read also:

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