In Florida, renewals are traditionally re-negociated at this time of year as it is the start of the Atlantic hurricane season on June 1.
Experts at Colorado State University have predicted 14 tropical storms this year and said seven would develop into hurricanes, with forecasting pioneer William Gray saying 2009 would be another "above-average" hurricane season after an active 2008.
This, plus the global shortage of capital, had everyone hoping for significant price rises. These first failed to materialise at 1/1, and now are falling short at 1/6.
But there are signs that things are picking up. Just when everyone said there was no capital to be had and the only way to maximise capital was either to buy back debt or do the kind of share-swapping deal seen in the IPC-Max Capital proposed merger, RenaissanceRe has set up a Florida cat sidecar with $60 million of equity. Timicuan Reinsurance II Ltd, or Tim Re II, (by the way, have they run out of renaissance artists to name their sidecars after?), has $10 million of RenaissanceRe's money and is the first new sidecar to be launched since January 2008.
It is a small green shoot, but prices will still need to rise by about 20 to 30% for there to be the kind of sidecar activity seen in 2006, when about 20 sidecars with about $4.5 billion in capital were formed.
I think we will have to wait to see what the hurricane season produces this year before we go popping that champagne cork
