Hannover Re forecasts significant rate hikes from market-changing impact of COVID-19

Hannover Re expects to see significant price increases across property and casualty reinsurance in the forthcoming January treaty renewals.

Sven Althoff, a member of Hannover Re's executive board responsible for property and casualty reinsurance, said: “From our perspective, COVID-19 is a market-changing event that can be compared with the terrorist attacks of 11 September 2001 or hurricanes Katrina, Rita and Wilma in 2005.”

He added: “The true scale of the losses caused by the pandemic will only become clear over the long term. We see the COVID-19 pandemic as a catalyst for fundamental adjustments to prices and conditions at insurers and reinsurers alike. Just how these manifest themselves will, however, vary by region and line of business.”

Hanover Re said that for both the primary and the reinsurance market, technical underwriting profitability would be essential for the foreseeable future if the industry wanted to maintain its risk-bearing capacity.

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