Fitch Ratings is forecasting that market conditions for the global reinsurance industry will improve, but its fundamental outlook on the sector remains negative, Insurance Business has reported.

The industry has been battered by third quarter catastrophe losses from hurricanes Harvey, Irma and Maria as well as earthquakes.

The ratings agency cited intense market competition, depressed prices, and low investment yields as impacting reinsurers’ profitability, adding that significant catastrophe losses will drive an underwriting loss this year.

Non-life reinsurers posted a reinsurance combined ratio of 116% for the first nine months of 2017 compared to 91% in the same period last year because of “28 points of near record catastrophe losses primarily from hurricanes Harvey, Irma and Maria,” Fitch stated.

Every reinsurer it tracked posted a combined ratio of more than 100% for the first nine months of 2017, except PartnerRe at 99%.

The report said that Fitch expects a reinsurance combined ratio of 96% for 2018, with reinsurance pricing likely to turn positive.

“While the fundamental outlook is negative, the ratings outlook is stable as most ratings are expected to stay at current levels over the next 12-18 months,” Insurance Business reported.

However, it noted Fitch said the sector’s rating could change to negative if there is a significant development in loss estimates or added large losses before the end of this year.