Kathmandu. With the growing demand for assets and disaster reinsurance in the global reinsurance market, reinsurers are increasing paid-up capital for financial empowerment.
According to a 2024 global reinsurance business report published by reinsurance company Gallagher Riley, the capital dedicated to the global reinsurance industry reached a total of $769 billion in 2024. This is an increase of 5.4 percent over the paid-up capital of 2023.
In its report, gallagher relay said that the combined proportion of the subgroup of 16 reinsurers improved to 86.8 percent in 2024. Which was 87.3 percent a year ago in 2023.
“The capital position of the global reinsurance industry remains strong on an economic basis, which is seen as the most relevant measure for measuring the decision-making of Gallagher Relay management teams,” the report said.
Driven by gala house relays, high rates or property and accident reinsurance, reinsurer’s business growth remained strong at 8.1 percent in 2024. Exposure growth remained muted as companies tried to reduce their risk in the U.S. crash business.
According to Gallagher Ray, the return on equity of reinsurers remained strong at 17 percent in 2024, although it was slightly lower than 19.5 percent in 2023. In the report, the reinsurer believes that reinsurers will be in a strong position to maintain strong profits in 2025.
“California wildfires caused substantial insured damage at the start of the year, even though these losses have proven to put pressure on the annual disaster budget, reinsurers are in a better position to provide returns on underlying investments, which is almost double the cost of the industry’s capital,” the report noted. “
Considering substantial profits, traditional reinsurance capital is growing by 6 percent this year, the Gallagher Relay report noted, adding that “the resilience of the reinsurance industry has improved materially over the past three years.” “
