Bermuda’s reinsurance executives and their global colleagues are in Monte Carlo this week for the sector’s largest annual meeting, Rendez-Vous de Septembre, commonly referred to as the Reinsurance Rendez-Vous, returning after a two-year hiatus.

The reinsurers are cautiously emboldened by a hardening market, while also wary of the significant macroeconomic and structural headwinds – as well as urgency relating to climate risk, trust and societal purpose, according to Arthur Wightman, PwC Bermuda Territory Leader.

PwC’s global insurance team is hosting a series of events Monday at the Hermitage Hotel, including its Executive Breakfast Briefing featuring keynote speaker, Greg Case, CEO of Aon; the launch of PwC’s market-leading legacy and run-off market survey; and, the debut of a new ESG digital experience exploring underwriting the transition to net zero.

Mr Wightman said: “Expectations continue to mount for the industry to play an even greater role in environmental, social and governance issues, as both investors in and underwriters of other corporations.

“Bermuda’s reinsurers, in particular, have a key role in increasing global resilience by moving to the forefront of ESG innovation.

“Setting a long-term ambition that’s supported by tangible near-term commitments is the right first step to expand their relevance beyond climate-related risk transfer and to take an active role in changing outcomes on a broader scale.”

He added: “As the market gears up for the January renewal period, inflation is playing heavily on discussions as reinsurers reassess their appetite for natural catastrophe risk.”

“And while rates are expected to continue to harden more so than has been evident in almost 20 years, reinsurers are increasingly wary of rate adequacy, paying particular scrutiny towards models and terms in the face of climate, inflation and geopolitical risks.

“Getting pricing right on both short and longtail lines is immensely challenging at this time and a rising tide may not be enough to mitigate against significant margin erosion without great discipline and skill.”

“Bermuda’s leading P&C position is expected to continue, and yet reinsurers are showing agility in the composition of their books.

“Despite their many challenges, Bermuda reinsurers have seen substantial growth in net premium written and continue to evolve and innovate, with much greater investment in specialty lines than a decade ago. This agility is a well-defined characteristic of the Bermuda market.”

Another topic to feature prominently in Monte Carlo this year is the momentum in the legacy and run-off market, which continues to experience significant deal activity.

“As the run-off market evolves, it has established itself as part of the mainstream insurance sector,” Wightman said.

“We look forward to sharing the findings of PwC’s 2022 Global Insurance Run-off Survey and our Bermuda market perspective at this year’s Reinsurance Rendezvous.”