Archive for September, 2014

The world’s largest reinsurance firm Munich Re is not weathering the soft market environment as well as analysts at RBC Capital Markets had expected, with the reinsurer now not expected to hit its stated profit target of €3 billion for the year.

One of the issues that prevent third-party capital, from sources such as pension funds and other institutional investors, from entering and disrupting the reinsurance and insurance market on a more wholesale basis, is the complexity in some lines of business.

At German reinsurance firm Munich Re’s annual Monte Carlo insurance-linked securities (ILS) roundtable event yesterday, first time sponsors of catastrophe bonds and other ILS market experts discussed some of the pro’s and con’s cedents encounter.

The reinsurance market of the future will be reshaped as growing pools of third-party capital are increasingly leveraged, alongside ILS structures, to bring efficiency into the reinsurance industry, according to broker Guy Carpenter.

Insurance-linked securities (ILS) specialist law firm Sidley Austin LLP warns that issuers of catastrophe bonds could become subject to payment of withholding tax on U.S. Money Market Fund dividends after an exception ceases to apply.

In its recently published alternative reinsurance market update, Fitch Ratings highlights potential concerns over recently formed casualty risk focused part-sidecar, part-third-party capital vehicle, part-hedge fund strategy reinsurer Watford Re.

The asset management arm of French reinsurance firm SCOR, SCOR Global Investments, has announced that it has grown its insurance-linked assets to $460m and achieved a net average annual return to investors of 7.2% since inception three years ago.

TigerRisk Partners, a reinsurance broker, risk and capital management firm with a strong reputation in the catastrophe arena, is opening a Bermuda office both for traditional products but also to answer demand for retrocessional reinsurance solutions.

Across the peak catastrophe zones, insurance-linked securities (ILS) funds and their managers have had a real impact on pricing and this looks set to continue as ILS capitalises on its lower cost of capital, a survey undertaken by Willis Re found.

Gibraltar’s financial regulator, the Financial Services Commission (FSC), has finalized and published its guidelines for insurance-linked securities (ILS) following a consultation process with input from ILS experts from around the world.