Global reinsurance rates are likely to continue rising next year, in the low to mid-single digit percentage range, Moody’s analysts said on Tuesday.

Reinsurance rates have been rising in the past few years after natural disasters such as hurricanes and wildfires, as well as from the impact of the COVID-19 pandemic.

“We expect this (price) trend to continue,” Moody’s insurance credit analyst Helena Kingsley-Tomkins told a media briefing.

Insurers and reinsurers face the risk of future natural catastrophes, with climate change making them harder to predict. Moody’s said demand for insurance and reinsurance is also rising as the global economy recovers.

The ratings agency also raised its outlook on global reinsurers to stable from negative on Tuesday, citing rising premium rates amid a global economic rebound.

Reinsurers share the burden of large losses such as from hurricanes with insurers, in return for part of the premium.

Insurance losses as a result of the pandemic had amounted to around $37 billion so far, Kingsley-Tomkins said, far below initial industry projections of as much as $100 billion.

Fitch also said on Tuesday the outlook for the sector was improving due to higher prices, an economic rebound and lower pandemic-related losses.

The ratings agencies usually update their outlooks ahead of an annual reinsurance event in Monte Carlo each September. The event is taking place virtually this year.

Global property and casualty (P&C) insurance premiums are set to more than double to $4.3 trillion in 2040 from $1.8 trillion in 2020 as the sector shifts from lower-risk motor insurance towards higher-risk property and liability lines, the Swiss Re Institute forecast this week.

(Reporting by Carolyn Cohn; editing by Marc Jones and Susan Fenton)