Property market remains soft, according to Guy Carpenter analysis of July 1 renewals. All the extra capital in the industry continues driving rates lower.
Update: Willis agrees (via Insurance Note’s twitter feed) and cites the confluence of three factors:
The trio of down cycle drivers, namely, excess capital, stable investment returns and limited growth prospects, continues to weave its magic, obscuring hidden dangers lurking in the quarters ahead. Barring any major industry event which removes a considerable part of the excess capital, it seems that the global reinsurance market is unlikely to see any rating upturn in the near future. In fact, there is a growing nervousness that the longer the wait for any upturn, the more abrupt it will be when it eventually arrives.
But Willis thinks a bad hurricane season could move rates higher.