RPS CEO Kevin Doyle has said January 1 reinsurance renewals will be a “telltale sign of what’s to come” for the overall casualty market.
Doyle told Insurance Insider US at the annual WSIA conference: “I think what happens on January 1 from a casualty perspective in the reinsurance space will really drive a lot of what we see [in the wider market] next year.”
He added that the impact of some of the bigger challenges in casualty such as regulatory and legislative challenges, nuclear verdicts and litigation funding will drive those reinsurance discussions.
Renewal discussions will be challenged “until some of those pieces change”.
“I wouldn’t be surprised if comes down close to the wire again like we saw a few years ago in the property space,” he said.
Talking points during the recent Monte Carlo Rendez-Vous de Septembre were similar – litigation loss trends and the uncertainty around rate adequacy.
This publication also noted the crack in confidence around accident years 2020-2023, despite the more solid belief that these would prove to be strong performers earlier this year.
In property, Doyle noted that how much rates fall will depend on whether we see a major storm this season, adding that there is more capacity coming into the space, particularly with MGAs.
The CEO added that, in the greater E&S space, market conditions will move up and down over a period. However, he believes there will not be as much flow out of the E&S sector back into admitted.
“I don't necessarily know that we'll be able to think about [the inflows and outflows] the same way we did historically,” he said.
“What I mean by that is 10-15 years ago, many carriers didn't have their own E&S businesses, now that they do have their own wholesale only operations. That does start to change how business may flow in and out,” Doyle said.
The CEO also highlighted an ongoing topic at the WSIA conference that AI is becoming more mainstream. Doyle stated that there are a lot of unknowns, given that AI is still so new and industry players need to do their due diligence on it.
“There's a lot of potential, but we're not going to just rush to do something. We're going to have governance around it. We know there's potential there, and we have people working on what that looks like on a forward basis,” he said.
“I think a lot of companies are being smart and thinking through what their strategy looks like versus rushing into a solution before they understand anything.”