Price increases have to continue: Scor’s Conoscente

Rate increases have been prevalent across both loss and non-loss affected programmes, but Jean-Paul Conoscente, CEO of SCOR Global P&C, told The Insurer this must continue.

“We definitely believe that price increases have to continue in 2020,” said Conoscente.

“The June/July renewals were very good in terms of US property, even if they were a little disappointing outside the US,” he added.

Speaking to The Insurer at this year’s Monte Carlo Rendez-Vous, Conoscente said the low rate environment, losses that were accumulated in 2017 and 2018, plus years of operating in a soft market cycle have all contributed to the pricing momentum seen at the mid-year property renewals.

Looking at what role retro market conditions will play at 1.1, Conoscente believes there are “difficult” times ahead.

“I believe the retro markets are going to be very difficult at 1.1 and this will have an effect as the cost of capital for reinsurers will go up,” he said.

“This is also forcing reinsurers to be more prudent on the type of risk they take and more focused on technical profitability,” he added.

Discussing the topic of whether casualty cedes need to come down, Conoscente said these “definitely need to come down”.

He added: “The level right now covers not only the cost of insurers and the cost of acquisition, but has a significant margin on top of that and that is no longer sustainable. Given the low rate environment, those commissions have to come down.”