Aggregate catastrophe budgets among the top 21 global reinsurers rose almost 20% to $15.5 billion this year, but those companies diverged on strategy, with some taking more risk and some less, according to a report Monday from S&P Global Ratings Inc.

That diversity may be the result of higher-than-expected catastrophe losses over the past five years, according to S&P.

In addition to the rising losses, the catastrophe budget growth may also be due to reinsurers allowing for exposure growth while also factoring greater climate variability into their forecasts, S&P said.

Reinsurers also continue to use retrocession as part of their overall catastrophe strategy, although rising retrocession rates may lead to reinsurers progressively ceding less risk, according to the report.

“Retrocession, including use of third-party capital, remains a flexible and key strategic way to manage tail risk. Data at Jan. 1, 2022, suggest that reinsurers have largely maintained their use of retrocession since 2021,” the report said, noting, however, that “rates in the retrocession market continue to increase. This means reinsurers may have to cede proportionally less of the risk if it becomes too expensive.”