Reinsurers are delivering strong profits, but it is mainly by shrinking exposure, tightening underwriting and returning capital rather than chasing premium growth, first-quarter results from Everest Group illustrate.

The Bermudian-based re/insurer reported a sharp rise in first-quarter earnings this week, but its results also showed a deliberate pullback in risk as the market gets more competitive.

Jim Williamson, Everest president and chief executive, said the company will focus on returns rather than expansion.

“We will continue to prioritise profitability and shareholder return over top-line volume,” he told investors in a Thursday earnings call.

That approach was evident in the group’s underwriting strategy, particularly in casualty lines, where Everest has reduced its exposure.

“Since January 2024, we have reduced casualty premium by more than $1.2 billion … an indication of the level of discipline we’re bringing,” Mr Williamson said.

The comments come as the global reinsurance market shows signs of softening after a period of strong pricing, with Everest noting that property catastrophe rates declined at recent renewals.

“Property catastrophe pricing continued to soften … [but] structural discipline remained intact,” Mr Williamson said, adding that terms and conditions and attachment points had held firm.

The pattern is not unique to Everest.

Arch Capital Group recently reported quarterly profit of about $1 billion, driven by improved underwriting performance, while RenaissanceRe also posted a strong first quarter as cat losses eased.

However, both companies also pointed to lower premium volumes in key lines, and a broader trend of reinsurers stepping back from business that does not meet return thresholds.

At the same time, the sector is seeing more capital returns.

Everest raised its quarterly share buyback floor to $300 million, signalling confidence in its earnings and an unwillingness to pump capital into underwriting with pricing as it is.

Other Bermuda insurers have taken similar steps. RenRe repurchased hundreds of millions of dollars in shares during the quarter, while Conduit Holdings has also reinstated a buyback programme.

The shift comes against a backdrop of falling global insurance rates and abundant capital, which have increased competition and pressured pricing across many lines.