Monte Carlo Reinsurance Rendezvous 2017

Latest Monte Carlo Rendezvous Reinsurance news:

Returns could be lower than traditionally anticipated: Beale, Lloyd’s CEO
September 19th, 2017 – Looking forward as the insurance and reinsurance market adjusts to the new normal of efficient capital and sources of competition, the traditional market may have to accept that returns could be “lower than we’ve traditionally anticipated” from here on, according to Lloyd’s Chief Executive Inga Beale.

Strong investor interest for expansion of ILS space: Bill Dubinsky, WTWS
September 15th, 2017 – In an interview with Artemis, Bill Dubinsky, Managing Director and Head of Insurance-linked securities (ILS) at Willis Towers Watson Securities (WTWS), discussed the continued growth and expansion of the sector in light of a record-breaking issuance year and potential impacts of hurricane Harvey and hurricane Irma on the catastrophe bond market.

Irma tests ILS, but opens up opportunities: Dirk Lohmann, Secquaero
September 13th, 2017 – Anticipating rate movement post-Irma, Dirk Lohmann, chief executive of Zurich-based ILS fund manager Secquaero reveals the company is working with Schroders (its main backer) to come up “with additional offerings that are more focused on just the U.S. risk.”

ReinsurTech to help reinsurers compete with alternative capital: S&P
September 13th, 2017 – Can ReinsurTech (reinsurance technology, the next buzzword after InsurTech) help reinsurers to compete with alternative capital providers and insurance-linked securities (ILS) funds, at a time when price competitiveness is key? The answer is yes, but not as much as reinsurers would like it to.

New capital may not be willing to replace trapped collateral: Albertini, Leadenhall
September 12th, 2017 – If rates do not harden materially post-Irma, there may not be appetite for new ILS capital to come into the industry to replace collateral that is tied up at 1 January, thinks Luca Albertini, speaking to Artemis at the Rendez-Vous de Septembre.

Irma could be a market-changing event: David Priebe
September 11th, 2017 – Irma is set to be a material loss for the insurance and reinsurance industry, with ILS markets anticipating one of the most significant events to hit the sector, said David Priebe, talking to Artemis on the Sunday morning of the Rendez-Vous event in Monaco.

ILS losses expected. It’s how the market reacts that matters
September 11th, 2017 – The insurance-linked securities (ILS) market is expecting pay its share of losses from recent catastrophe events, perhaps the most significant losses in the sectors 20 or more year history. But participants say they stand ready to support clients and explained today that it’s how the market reacts that matters.

London can be global ILS hub, regulator support essential: Des Potter, GC
September 11th, 2017 – London has the potential to become the international hub for innovative insurance-linked securities (ILS) transactions so long as the UK regulator shows support, according to Des Potter, Head of GC Securities, EMEA, Guy Carpenter.

Only the strong will survive the evolution of reinsurance: S&P interview
September 10th, 2017 – In an interview with Artemis, Directors of S&P Global Ratings’ reinsurance analytical team have discussed pricing in the global reinsurance sector as the January 1st, 2018 renewals season approaches. The prospects of insurance-linked securities (ILS) were debated, as well as other burning industry topics, such as new business lines, pressured markets, and the impact of hurricane Harvey.

Expect ILS sector to be larger post-event: Paul Schultz, Aon Securities
September 10th, 2017 – We should expect the insurance-linked securities (ILS) sector and its pool of alternative reinsurance capital to be larger post-major catastrophe events, than before it. As investors stand ready to launch new structures and deploy post-event capacity, according to Paul Schultz, CEO of Aon Securities.

Alternative capital nears $90bn, pushing cat bonds to new records: Aon
September 7th, 2017 – The amount of alternative capital in the reinsurance industry has risen by 10% during the first-half of 2017 to close in on the magic $90 billion figure, with the abundance of ILS capacity helping to stimulate record catastrophe bond issuance and a new market high, according to the latest report from Aon Securities.

ILS to continue expansion despite efficient traditional reinsurance: Moody’s
September 7th, 2017 – A recent Moody’s survey reveals that property & casualty (P&C) reinsurance buyers don’t expect to increase their use of alternative capital in 2018 in light of competitive pricing in the traditional segment, but Moody’s still expects the expansion of insurance-linked securities (ILS) to continue.

Reinsurer RoE’s drop again, as expenses rise & reserves shrink: Willis Re
September 6th, 2017 – It continues to surprise that at a time when reinsurance company returns are shrinking that they continue to spend more. Willis Re reports this morning that the efficiency of the industry is declining in real-terms, based on reinsurers underlying returns-on-equity (RoE’s) dropping to just 3.7%, while expense ratios continue to rise.

Reinsurance prices to decline further, ILS capacity to expand in 2018: Fitch
September 6th, 2017 – Reinsurance prices are expected to continue to decline over the coming year, as weight of capital in the industry and other factors continue to depress returns, with alternative capital and ILS a key factor that is expected to exacerbate reinsurers’ ability to make higher returns, as ILS capacity is forecast to keep expanding.

Reinsurers near cost-of-capital, as alternative capital tide flows in: S&P
September 5th, 2017 – Global reinsurance firms are destined to only barely cover their cost-of-capital even under the lighter load of a normal catastrophe year, as the pressures of the softened and competitive market continue to bite, according to rating agency Standard & Poor’s.

Active catastrophe year could be “downright ugly” for reinsurers: A.M. Best
September 5th, 2017 – The conditions in reinsurance markets continue to be challenging and with reinsurers only destined to make mid-to-high single digit returns, a normal catastrophe year “will expose the true ramifications of current market conditions” while an above average catastrophe year could be “downright ugly” according to A.M. Best.

New cat bond record as 12 month issuance hits $13.5bn
September 1st, 2017 – Data from the Artemis Deal Directory shows that catastrophe bond issuance over the 12-month period ending August 31st, 2017 reached a new market high of $13.5 billion, and with insurance-linked securities (ILS) predicted to expand its remit, further growth is likely.

Expect sixth successive January renewal of price declines: Fitch
August 22nd, 2017 – In global reinsurance markets, the endurance of alternative capital from ILS funds and capital market investors, as well as the recent uptick in catastrophe bond issuance, has helped to make the pricing floor elusive and Fitch Ratings sees no sign of it coming into view anytime soon.

As ILS strains reinsurance pricing, reinsurers survive on low losses, reserves: Fitch
August 18th, 2017 – Record levels of activity and growth of insurance-linked securities (ILS), catastrophe bonds and collateralised reinsurance continues to put a strain on reinsurance pricing and some reinsurers are only remaining profitable thanks to low levels of major loss and reliance on reserve releases.

How long can “little better than break-even” be sustained?
August 16th, 2017 – Just how long can an industry continue to operate in a traditional manner while the performance of its main revenue stream is described as “little better than break-even”? This question leaps to mind when reading the latest reinsurance report from Fitch Ratings.

Bermuda reinsurance strategy shift: primary rises, retention falls
August 16th, 2017 – Bermudian reinsurance firms are increasingly becoming insurance firms, as the significant shift in underwriting portfolios of major players based on the island continues. Alongside a shift to primary business the Bermudian re/insurers are also retaining less risk, as they make use of market conditions and alternative capital to better manage their exposures.

Catastrophe exposure rising, as soft reinsurance market bites: S&P
August 15th, 2017 – The effects of the softening reinsurance market are increasingly becoming evident and rating agency Standard & Poor’s highlights that reinsurers stand to suffer much greater earnings volatility as their performance becomes more sensitive to large catastrophe loss events.

Investment oriented reinsurance model best when sponsored: S&P
August 8th, 2017 – The total return reinsurance model, or investment oriented reinsurance model, or hedge fund backed reinsurance model (depending on what you prefer to call it), remains a challenging strategy to execute on well, but more recent start-ups that are sponsored by an existing re/insurer and asset manager are favoured by S&P.

Alternative capital record high a driver of reinsurance M&A: S&P
August 2nd, 2017 – The search for scale, in order to achieve market relevance, continues in the global property and casualty insurance and reinsurance market. Abundant low-cost capital boosted by an all-time high of alternative capital is driving the trend for mergers & acquisitions (M&A), according to Standard & Poor’s.

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All of Artemis’ coverage from the 2016 Monte Carlo Rendezvous can be found here.

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