LONDON — Hardening reinsurance market conditions in the Middle East and North Africa region, as well as changes in reinsurers’ appetites as to where they deploy their capital, have sustained the positive price momentum over recent renewal seasons, according to an AM Best report.
The Best’s Market Segment Report, “Opportunities Arise for MENA Reinsurers Amid Divergent Economic Conditions,” notes that reinsurance capacity in the region continues to be highly changeable and dynamic against a backdrop of divergent economic conditions across the region for oil-exporting and oil-importing countries.
AM Best analysts also state that operational challenges and deteriorating country risk landscapes in several countries in the region have weighed negatively on their view of the financial strength of the reinsurers domiciled and operating in these countries. While several companies have experienced Long-Term Issuer Credit Rating downgrades over the past year, on the whole, MENA reinsurers rated by AM Best tend to demonstrate risk-adjusted capitalisation assessed at the strongest level, which is reflective of significant capital buffers relative to their operational exposures.
