Growth opportunities remain in the reinsurance market, which has been depressed in recent years by an influx of cheap alternative capital, S&P Global Market Intelligence says.

It says the US mortgage reinsurance sector, growing demand for cyber and terrorism covers and emerging economies’ fast-growing insurance markets are areas reinsurers may consider.

“Despite the soft market’s shadow over the reinsurance industry, there are still opportunities for disciplined growth,” the ratings agency says in a new report.

“Reinsurers have done a good job adjusting their business tactics to adapt to persistently soft market conditions by building large capital bases while maintaining disciplined underwriting anchored around their enterprise risk management strength.”

The US National Flood Insurance Program, which is due to expire in September, is another area of potential growth – if Washington approves its renewal.

“We expect reinsurance to play an increased role [in the scheme], because it has described the 2017 reinsurance transaction as ‘setting the foundation for a multiyear reinsurance program’.”

The report says reinsurers have generally demonstrated remarkable resilience amid adverse conditions, through initiatives including expanding primary insurance operations, offering tailor-made solutions and pursuing mergers and acquisitions.

“The common initial response is to revert to underwriting discipline.

“However, beyond this, strategies vary as each management team is taking a different approach that plays to its business’ individual strengths.”