MILLIRE ENG2024

maintained their appetite for property catastrophe programs, competition remained strong particularly for peak perils and upper layers where notable risk-adjusted price reductions were observed. Although loss-hit programs renewed with considerable price uplifts, risk-adjusted global property rates on-line decreased by circa 7% on average, marking the first reduction after seven years of consecutive increases. However, rates still remained at historically high levels, with great variation across regions depending on reinsurers’ view of price adequacy. The January 2025 retrocession renewals were shaped by a combination of abundant capacity, limited catastrophe losses, and increasing market competition. The oversupply in property retrocession market, driven by increased capacity deployment of existing reinsurers and the new capital inflows into the ILS market, led to downward pressure on prices at 1.1 renewals. However, prices and retention levels remained higher than those of 2022, underlying persistent market discipline despite increased competitiveness. While improved purchasing conditions and portfolio growth modestly increased demand, with limited losses to the retrocession market from major natural catastrophe events including Hurricanes Helene and Milton, retrocession providers were able to sustain their profitability and utilize retained earnings to meet demand. Additionally, the structural changes introduced in previous years reduced the risk of trapped capital from large losses, further supporting market resilience. It was also noteworthy that the renewals were delayed beyond the usual timeline, with a significant portion of the programs being placed in the last two weeks of December, with market conditions softening towards the end of the year. Showing great variation depending on program attachment levels, scope of cover and loss history, risk-adjusted retrocession catastrophe prices declined by 7.5% to 20%. On the other hand, the most significant price shifts and competition have been observed at the tail end of programs, where products overlapped with the catastrophe bond market. Although competition was high for mid and top layers, capacity for low attachment layers and aggregate covers remained restricted. Europe 2024 marked a period of both challenges and resilience for the European reinsurance market. Three major flood events, impacting Spain’s Valencia region in October, Germany and neighboring countries in June, and Central and Eastern Europe in September, stood out as the most notable catastrophes of the year and highlighted once again the region’s growing vulnerability to climate-related risks. Despite these challenges, capacity was abundant to successfully meet cedants’ needs, supported by disciplined underwriting and improved market conditions. While demand remained strong driven by inflationary pressures and organic portfolio growth, reinsurers effectively managed capacity allocation to maintain market balance and renewals proceeded smoothly in contrast to previous years. Tailored to cedants’ needs, risk assessments and pricing adjustments were closely tied to regional loss experiences. Catastrophe excess of loss programs in Central and Eastern Europe faced significant pressures, particularly in regions impacted by Storm Boris and the September floods. Inflationary pressures increased capacity needs, while similar retention levels aligned with the previous renewal helped reinsurers and buyers navigate the renewal process effectively. Although loss-free programs benefited from moderate price reductions, loss-affected treaties saw controlled price adjustments, albeit avoiding sharp increases. Moreover, the shift from proportional treaties to risk excess of loss structures gained further momentum in 2024, as buyers sought to optimize costs and align their programs with evolving risk landscape. While risk-adjusted price reductions for loss-free catastrophe programs reached up to 15%, price adjustments for loss-affected catastrophe programs ranged from flat to up by 20%. As far as the risk programs were concerned, loss-free programs saw cost decreases reaching up to 10%, whereas price increases for loss-affected programs varied in the range of 0% to 20%. GENERAL INFORMATION FINANCIAL RIGHTS PROVIDEDTOTHE MEMBERS OF THE GOVERNING BODY AND SENIOR EXECUTIVES RISKS AND ASSESSMENT OF THE GOVERNING BODY ACTIVITIES AND MAJOR DEVELOPMENTS RELATED TO ACTIVITIES RESEARCH & DEVELOPMENT ACTIVITIES FINANCIAL STATUS FINANCIAL INFORMATION 63 2024 Annual Report