The most often used general explnation for the hard underwriting cycle is when insurance is profitable and the premiums are really high.
Is the scenario where premiums are high and the premium rates being unprofitable also qualify for an uw cycle being hard?
For instance, after 9/11, reinsurers stopped writing terrorism covers and the premiums shot up immediately (an interesting tidbit here for actuaries is that GIC Re, the state owned indian reinsurer, was able to get into the US markets post 9/11 due to some reinsurers not underwriting their book).
In this scenario, would it be correct to say that the underwriting cycle went from soft to hard (because premiums increased)?
Is the scenario where premiums are high and the premium rates being unprofitable also qualify for an uw cycle being hard?
For instance, after 9/11, reinsurers stopped writing terrorism covers and the premiums shot up immediately (an interesting tidbit here for actuaries is that GIC Re, the state owned indian reinsurer, was able to get into the US markets post 9/11 due to some reinsurers not underwriting their book).
In this scenario, would it be correct to say that the underwriting cycle went from soft to hard (because premiums increased)?