Reinsurance rates could drop quickly in 2007 if this year's hurricane season proves to be less damaging, according to delegates at this year's Monte Carlo Rendez-Vous.
Guy Carpenter chief executive, David Priebe, said there was greater stability this year after the uncertainty of hurricanes Katrina, Rita and Wilma. But many warned that the market could turn if there were fewer hurricanes this year.
On a positive note, delegates felt that the new capacity entering the reinsurance market would be there for the long term.
XL Capital chief operating officer Henry Keeling, welcomed alternative capacity sources like sidecars and said the "interaction between the capital markets and traditional reinsurance was very positive for the industry".
Meanwhile, Standard & Poor's (S&P's) issued a stark warning about the strength of the global reinsurance market. S&P's current highest rating for a reinsurer is AA- following five years of declining financial strength, coupled with the withdrawal of major insurers such as AXA.
Elsewhere, Catlin Group chief executive Stephen Catlin, insisted that a truly global insurance and reinsurance group must have a presence in all markets.
Referring to rivalry between the US, Bermuda, Lloyd's and London, he said it was "not a time for petty rivalries".
Catlin insisted that the industry had to work together to cover very high exposures and that "individuals who live in catastrophe-exposed coastal regions should pay for that lifestyle decision...however high the cost may be".
But Lloyd's director of worldwide markets Julian James said there was currently an "unhealthy focus on hurricane risk in the US."
"It's a big issue but not the only big issue," he said.
Hosted by comedian and actor Tom Allen, 34 Gold, 23 Silver and 22 Bronze awards were handed out across an amazing 34 categories recognising brilliance and innovation right across the breadth of UK general insurance.
