During Conduit Re’s media call that took place earlier this afternoon following the release of the company’s Q123 results, Chief Underwriting Officer, Greg Roberts responded to a question asked by Reinsurance News in regards to the firm’s retrocession tower, as well as dynamics in the retro market.
He said: “We made the comment that we were very happy with the core placement of our retro at 1/1. Clearly, it’s not a big market so it’s a tough market, and the retro market probably in the last few years has been ahead of the reinsurance market in looking for margin.
“And I suppose the big dynamic now is the reinsurance market has probably, on the excess of loss side anyway, caught up somewhat.”
Roberts also went on to say that it is “Interesting to see different strategies around allocating capital, particularly to writing retro, and so expect to see some dynamic changes through the rest of the year with sellers of retro in particular.”
Additionally, Conduit Re’s Chief Executive Officer, Trevor Carvey also explained during the call that accessing the catastrophe bond market as an alternative form of retrocession, is something that the reinsurer is “actively considering”.
Carvey stated that a cat bond could soon be “in the pipeline” for the reinsurer.
He said: “On the cat bond, yes, we recognised that at year-end it as a useful alternative to the standard tower of cover that we bought, which is essentially excess of loss on a tower basis.
“So, we certainly did a lot of work at year-end. That’s in the pipeline. We did some work on that, we’ve dusted that off now.”
In their Q123 results, which was released earlier this morning, Conduit Re reported that its ultimate premiums stood at $443.2 million, showing a 50.7% increase from Q122, with gross premiums written also hitting $278 million, showcasing a 59.1% increase from the prior year period.