In a research note published late last week, analysts at Nomura Equity Research reported that prices for Jan. 1 reinsurance renewals are falling faster than expected, with some U.S. property catastrophe risks seeing 25 percent declines.

The analysts, Clifford Gallant and Matthew Rohrmann, said their assessments are based ondiscussions with brokers and underwriters in advance of official contract signings, which are still two weeks away.

While prices in Europe and the UK are coming in in the 0-5 percent range, for U.S. property-cat reinsurance, prices may be down as much as 15-25 percent, they said, adding that reinsurers’ top lines will likely be hurt by increasing primary insurer retentions.

“Primary insurers are also keeping more of their own books of business, perhaps as much as 5-6 percent on average,” they wrote, describing the trend as an “economic oddity.”

“Shouldn’t insurers buy more, not less, of cheaper protection,” they ask, explaining the characterization.

Answering the question, they note that competitive pressures in the primary insurance market, increasingly efficient buying strategies, and higher confidence in the underlying profitability of their own books have combined to fuel the higher retentions.