Archive for April, 2015

As overcapacity and competition in the traditional reinsurance space filters down into primary lines, resulting in persistent pressures on U.S. commercial property and casualty (P&C) rates, Bernstein claims soft market cycle fears might be “overdone.”

Activity in the pension fund de-risking and longevity hedging market, including use of instruments such as longevity swaps, longevity insurance and reinsurance, is expected to surge, according to Towers Watson.

Following the intense, cold winter 2014/2015 in the U.S., estimations have put the resulting industry-wide insured loss figure at $2.3 billion, a $200 million decrease on the 2013/2014 season, according to Munich Re and Property Claim Services (PCS).

Lloyd’s of London Syndicate 2357, the first syndicate to enter the Lloyd’s reinsurance market backed by an insurance-linked securities player in Nephila Capital, has increased its gross written premiums by 136% to $33.3m for the 2014 year of account.

Competition in insurance and reinsurance has been on the rise. In the reinsurance market in particular, aggressive competition has been cited at recent reinsurance renewals, as players seek to put capacity to work and new capital keeps entering in the form of ILS.

Moody’s Investor Services has predicted a wave of further merger and acquisition (M&A) activity during 2015, driven by the increasing deterioration of the global reinsurance space.

PERILS AG, provider of industry-wide European catastrophe exposure, industry loss data and indices, has released an updated estimate of €335m for insurance industry losses from January’s European windstorms Elon-Felix.

Use of insurance industry loss triggers using data supplied Property Claim Services (PCS) increased in the first-quarter of 2015, as a record first-quarters’ catastrophe bond issuance saw PCS’ data used in $800m of transactional volume across 4 deals.

Louisiana Citizens Property Insurance’s latest catastrophe bond transaction, Pelican III Re Ltd. (Series 2015-1), has now been priced and at a level below the guidance, showing that investors were very willing to support the insurers risk transfer needs, even at a low multiple.

The structurally lower cost of reinsurance capital presents an opportunity to property & casualty insurers, as innovations in structures and business models prompt a rethink of insurers risk profiles and their role in the value chain, according to analysts at Credit Suisse.