SIRC 2026: ‘I don’t think that the market will turn anytime soon’: capital surplus continues to drive rate cuts ahead of 1.1 renewals: William Pang

November 5 2026 by

Fresh off the October 1 renewals in Indonesia, Asia Reinsurance Brokers (ARB) Group CEO William Pang expects the January 1 renewals to continue softening, with rate reductions of 15-20% depending on individual treaty performance.   

However, he believes that the pace of reduction is decelerating, “not as severe as in the past few major renewals”. 

“The reinsurance capital has increased substantially,” he told InsuranceAsia News’ Between the Lines podcast.  

“The latest estimate is about US$650 billion, meaning capacity is available. The demand is not keeping pace with the supply of reinsurance capital,” Pang said, adding that benign natural catastrophe activity is another factor driving the soft market conditions.  

“So, it will come to a point whereby the reinsurers will decide that it is still considered risk-adequate if the trend continues to go down. Should they continue to support a very soft market or step back and perhaps redistribute capital to other places globally where this is more risk-adequate, or returns are better?  

“So, I believe that it will come to an eventual equilibrium, whereby the reinsurance industry might face a roadblock. But for the next possible 12 months, unless there is a severe nat cat event or a severe catastrophe happening in the industry, I don’t think that the market will turn anytime soon.” 

Sustained return on capital of approximately 15%, along with the current view that pricing remains risk-adequate, allow reinsurers to keep deploying capital into the market, with treaties at renewals continuing to be over-placed by over 100%, Pang added.   

However, reinsurers are taking steps to tighten wordings, endorsements and structures including higher retention levels by the cedents, he said. 

“Reinsurers are trying to find ways to tighten here and there, but eventually it is still over capacity,” Pang said.   

“The other thing that I notice is that parametric solutions are coming into the market quite prominently from some reinsurers and MGAs. A few of our clients are obviously considering such solutions as a complement to their treaty programs.” 

The broker advised cedents to take advantage of the soft market by making sure that their retention is optimal, investing in innovation and productivity efficiency and entering specialty product lines that are less competitive.   

ARB business

Founded in 2000 in Singapore, ARB is primarily focused on the treaty reinsurance business and a facultative department primarily to support cedent fac.  

In the next 12 months, the broker will continue to deepen its presence in Southeast Asia, where Indonesia and the Philippines have been the growth drivers, while Thailand and Cambodia present further upside, Pang said.   

Over the next three to five years, ARB aims to grow beyond Southeast Asia, expanding into China, Hong Kong, and Taiwan, he added.   

In terms of products, the company is diversifying into life and health (L&H), to offset the sliding property cat income. 

“Insurance is a numbers game. Humans would just not be able to be as productive as technology and AI. So we need to think about that and this is what we offer to clients.” William Pang, Asia Reinsurance Brokers

“With property cat, you’re looking at a reduction of 20-25% of the income at renewals. So I decided to diversify a little bit and move into L&H,” Pang said.    

“We are licensed to broke L&H business in our Malaysian subsidiary, so I have tasked my Kuala Lumpur office to enter that space, and we are already seeing some success as some of our cedents are composite licensed companies. Therefore, we’re able to offer a more holistic service on the L&H side.   

“That’s how I would like ARB to gravitate towards.” 

To add value to our clients, the broker also aims to go beyond traditional reinsurance placement by providing AI technology and growth solutions to clients post treaty renewals. 

“Our AI products in claims management, for example, will cut down the time needed to process a claim. The AI-powered customer relationship management platform, meanwhile, allows insurers to quickly access customers that they can cross-sell to. 

“There are various tools and services that ARB offers to clients post treaty renewal, and I think this should be the way as a reinsurance broker. As brokers, ARB cannot just be a transactional broker. We have to do more than that.” 

Partner Content
Join the mailing list Designed to help you stay ahead, our daily newsletter provides a round-up of the latest news and insights, delivered straight to your inbox.
Print Edition
Subscribe to receive our quarterly print magazine.