Global reinsurer capital up 7% to $715bn at Sept. 30, says Aon

Global reinsurer capital increased 7%, or $45 billion from $670 billion at the end of 2023 to a new high of $715 billion at September 30th, 2024, with growth in both traditional and alternative capital on the back of retained earnings, unrealised gains on bonds, and a busy period for the catastrophe bond market, according to re/insurance broking group Aon.

Total, dedicated reinsurer capital has risen $20 billion from the end of March to the end of September 2024, and apart from a slight dip in 2018 and 2022, has been on the rise since 2015. In fact, global reinsurer capital has increased by 27% from the $565 billion recorded at the end of 2015.

Aon’s data puts traditional reinsurer capital at a record $602 billion as at the end of September, up 7% or $40 billion from 2023’s $562 billion, driven mainly by robust retained earnings. Reinsurers also benefitted from unrealised gains on bonds contributing directly to equity, while new start-up reinsurers were again absent in 2024.

“Most major reinsurers displayed improved regulatory and rating agency capital adequacy metrics on a risk-adjusted basis in 2024, taking deployable capacity to new peaks. The market’s willingness to deploy this capacity over the next few years in support of currently unmet client needs will likely define the sector’s long-term relevance,” says Aon in its January 2025 Reinsurance Market Dynamics report.

Market commentary on the January 1st, 2025, reinsurance renewals states that reinsurer appetite was strong and up when compared with last year, suggesting reinsurers are eager to expand and put more capital to work in still favourable market conditions, despite global property catastrophe rates softening somewhat.

2024 was also a strong year for the alternative reinsurance capital space, notably the catastrophe bond market which saw issuance levels hit new heights for the second year running.

According to Aon, alternative capital rose by 5% from $108 billion at the end of 2023 to $113 billion at September 30th, 2024, reflecting new inflows in the catastrophe bond market in the first and second quarters, which were extremely active periods for the sector.

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