Kiln says reinsurance rising

Lloyd’s insurer Kiln revised upwards its trading forecasts for the 2007 and 2008 years of account for four of its syndicates claiming its predicted soft market has not happened.

Kiln updated syndicate forecasts (previous in brackets)

2007

• 510 - 7.5% to 12.5% (5.4% to 10.4%)
• 557 - 12.1% to 17.1% (11.8% to 16.8%)
• 807 - 5.6% to 10.6% (4.6% to 9.6%)
• 308 - 4.2% to 9.2% (2.3% to 7.3%)

2008

• 510- 3.0% to 8.0% (2.6% to 7.6%)
• 557 - 7.6% to 12.6% (5.7% to 10.7%)
• 807 - 2.7% to 7.7% (2.3% to 7.3%)
• 308 - 10.1% to 15.1% (6.8% to 11.8%)

Reinsurance was its top performer. Kiln said renewal rating indices for syndicate 510 as at 30 June 2009 are, on average, 106% of those at the same time last year.

The rise has been greatest in US catastrophe exposed areas, it said.

Aviation to take off?

Aviation rates have remained low in a market that has been adversely affected by surplus capacity for some time, Kiln warned. “There have been a number of aircraft incidents this year and Kiln expects airline rates to increase, although they would need to rise significantly to achieve a sustainable level in all parts of the account,” it said

Kiln's director of underwriting, Richard Lewis said: “I am pleased that these revised forecasts show an improvement in forecast results for each syndicate in both years. This reflects a positive first half of the year, given the position in the underwriting cycle, and the effect of Hurricanes Ike and Gustav, which have had an impact on these two years of account.

“For 2009 we are continuing to focus our efforts on those parts of the account where we are seeing improved underwriting conditions, in particular in reinsurance, offshore energy and larger property risks.”