AM Best’s population of global reinsurance companies posted a return on equity (ROE) of 22% in 2023 – a five-year high that was driven mainly by favorable investment income and strong underwriting performance. The fundamentals are excellent but Hurricanes Helene and Milton “will probably stall any softening of the market cycle,” AM Best said.
Net investment income in 2023 led the contribution to surplus growth, followed closely by underwriting gains and unrealized capital gains – all components that pushed ROEs well above the cost of equity capital, said