Archive for July, 2015

The insurance and reinsurance value proposition is coming under attack as two factors, more widely available data on risks and abundant capital or risk transfer capacity, combine to erode the industries barriers to entry and disrupt incumbents.

Bermuda is seeking to ready itself to be considered as a “third-country,” or non-European Union, with passport rights under the Alternative Investment Fund Managers Directive (AIFMD), a move which would benefit local ILS funds and managers.

All of the international climate models surveyed by the Australian Government Bureau of Meteorology, for its latest update on the El Niño Southern Oscillation (ENSO), indicate that the current El Niño is likely to strengthen and persist into early 2016.

The Board of reinsurance firm PartnerRe responded to the latest improved offer from Italian investment holding company EXOR, saying that it acknowledges that the offer is reasonably likely to result in a “Superior Proposal”, but added that it still prefers the planned merger with AXIS Capital.

Aon Benfield, the reinsurance broking arm of Aon plc, said today that its Impact Forecasting catastrophe model team has determined that first-half 2015 catastrophe insured losses totaled just $15 billion, which is 47% below the ten-year average.

The potential market gap left by the surge of merger and acquisition (M&A) activity in the global reinsurance sector presents opportunities for start-ups in Bermuda and other risk transfer domiciles, but some industry experts have questioned if bigger is actually better.

RLI Corporation, a traditional specialty insurance and reinsurance company, has set the tone as the first to report in the second quarter results season, citing the “significant competitive pressure” in catastrophe exposed business lines.

An accusation often leveled at investors in insurance-linked securities (ILS) is that they are “hot money,” in other words capital that is prone to flight and could exit the reinsurance market at any point, due to losses suffered or because there are better returns to be found.

The market for insurance-linked securities (ILS) and catastrophe bonds lost some of its recent momentum in the first-half of 2015, with a decrease in the number of new cat bond sponsors and the emergence of a pricing floor largely responsible, according to Munich Re.

Italian investment holding company EXOR S.p.A. has again enhanced its offer for reinsurance firm PartnerRe, this time with a special dividend for common shareholders, as EXOR seeks to put the deal out of reach of the re/insurance merger transaction with AXIS Capital.