Pricing in the London Market continues to be under significant pressure across most business lines, so much so that rate adequacy concerns are increasing in offshore energy property, marine cargo and even casualty lines, according to PwC.
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Fitch Ratings has estimated that Italian insurers will only face a loss of between EUR100m and EUR200m, with reinsurance capital paying for the majority of claims, from this weeks magnitude 6.2 earthquake, far below the estimated figure of an $11 billion economic loss.
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In an effort to offset some of the negativity in the soft global reinsurance marketplace, companies are increasingly looking to enter new and diversifying business lines where the wealth of third-party capital is yet to have a meaningful impact, according to A.M. Best.
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All eyes in Florida and the Gulf Coast states will be on Invest 99L, a strong tropical low that is currently tracking west-north-west between Cuba and the Bahamas towards Florida, could develop into named tropical storm Hermine and which is forecast to pass into the Gulf of Mexico.
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An early estimate from the Italian Civil Protection Department suggests that this weeks devastating earthquake in Italy, near the Umbrian town of Norcia, could result in economic losses of around $11 billion, but the insurance and reinsurance market loss will be significantly lower.
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As Asian tail risk grows need for ILS increases: Lixin Zeng, AlphaCat

August 25, 2016

Compared with more developed regions, the Asian insurance and reinsurance market remains small, resulting in less concentration and focus on the tail risk. However, when penetration grows and the tail risk becomes more important there ILS’ role in Asia will grow, says Lixin Zeng.

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Cyber the fastest growing peril, will require reinsurance & ILS capital

August 25, 2016

Cyber risk is reportedly the fastest growing insured peril across the global property/casualty (P/C) insurance space, with the market forecast to expand to $20 billion by the year 2020. With the potential exposure so vast there’s a clear need for reinsurance capital, suggesting opportunities for ILS markets.

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Soft market aggregation build up a risk for reinsurers: Fitch

August 25, 2016

There is a risk that some reinsurance companies may have picked up “unintended aggregations” as they fight to retain business and compete their way through the soft market cycle, which presents a risk of certain firms facing larger than expected losses, according to Fitch Ratings.

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Innovation, engagement, risk transfer boosts disaster resilience: World Bank

August 25, 2016

The World Bank has again stressed the importance of innovative products from, and engagement with, the risk transfer industry, the World Bank’s message brings to mind the benefits of insurance-linked securities (ILS) structures.

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Fungibility of capital permanently changes reinsurance cycle: Markel CATCo

August 24, 2016

The abundance of capacity in the property catastrophe and retrocession reinsurance sector continues to contribute to a challenging environment, and signs are beginning to show of a change to the reinsurance market cycle owing to the fungibility of capital, says Markel CATCo.

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Capital inflows to hurt post-event profit of London re/insurers: A.M. Best

August 24, 2016

London market insurance and reinsurance players have historically benefited from playing the re/insurance cycle, but in today’s highly competitive marketplace, post-event profits for the London market are under threat from sidelined capital, says A.M. Best.

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No impact expected to Azzurro Re I cat bond from quake: Plenum

August 24, 2016

The magnitude 6.2 earthquake which struck the Umbria region of Italy overnight is not expected to be strong enough to trigger the Azzurro Re I Limited catastrophe bond, according to Zurich, Switzerland based ILS fund manager Plenum Investments.

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AIG said seeking sale of Lloyd’s assets (Ascot) to Canada Pension Plan

August 24, 2016

The appetite of the Canada Pension Plan Investment Board (CPPIB) to invest in insurance and reinsurance linked assets remains strong, with reports suggesting the $287.3 billion pension fund is in talks to acquire AIG’s Lloyd’s of London assets.

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M6.2 earthquake hits Umbria, Italy – some ILS assets exposed

August 24, 2016

A magnitude 6.2 earthquake has struck overnight in the Umbria area of Italy, with early reports of 10 deaths, people still trapped and widespread damage to buildings and structures in the affected region.

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Private ILS gains traction, increases share of issuance: GC Securities

August 23, 2016

The continued growth of private cat bond and ILS deals continued in the second-quarter of 2016, helping to offset a notable deterioration in traditional 144A issuance and a high volume of maturities that resulted in a decline of the outstanding market size, according to GC Securities.

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