A.M. Best says that reinsurance companies in the United States, Bermuda and other regions lost about 15 percent of their capacity in 2008, as measured by shareholders’ equity, but pervious good operating years, capital increases and improved loss reserves has kept the industry balanced.

In its special report, A.M. Best says its stress testing process, along with potential near-term underwriting opportunities, gives the global non-life reinsurance industry a stable rating outlook.

The report found that despite significant hurdles, the reinsurance industry’s core operations reported sound underwriting results, with the majority of carriers posting profitable combined ratios below 100.

US and Bermuda reinsurance markets absorbed Hurricane Ike, with insured losses nearing $20 billion, but the industry still saw a combined ratio for 2008 of 93.6 – profitable, says A.M. Best, but up 6.9 points from 2007. Finally, A.M. Best found that the January 1, 2009 renewal did not bring a universal hard market, with the exception of catastrophe-exposed risks.