Archive for November, 2016

In a “somewhat bottoming pricing environment” XL Group’s growth in the third-quarter of 2016 was driven by its reinsurance operations, where the firm took advantage of pockets of opportunities to offset the challenging marketplace, according to Mike McGavick and Greg Hendrick.

Reinsurance capacity and in future the depth of the ILS and capital market could be required to support casualty insurers against a growing number of industry headwinds, supporting the needs of a pressured sector while expanding the reach and influence of ILS capital and structures.

After four consecutive months of rates in the U.S. commercial P&C sector declining by an average of 1%, October saw average rate reductions accelerate across the sector, falling by an average of 2% in the month, according to analysis from MarketScout and Keefe, Bruyette & Woods (KBW).

Businesses across the globe should look to the capital markets in order to transfer basic catastrophe risks and weather risks off their balance sheets, for the benefit of both the cedent and the insurance-linked securities (ILS) space, according to ILS experts at JLT Capital Markets (JLTCM).

The portion of property catastrophe (P&C) risk transferred to the global catastrophe bond market from North America remains overweight, in part due to a lack of ILS penetration in other P&C markets across the world. And with investors keen for further diversification, non-U.S. exposed deals are expected to have a pricing advantage, according to reinsurance […]

In October 2016, the U.S. Money Market Fund (MMF) industry changed dramatically with new requirements for U.S. institutional prime and institutional municipal MMFs becoming effective. In our opinion however, thanks to a carve-out for U.S. government and Treasury funds, the insurance-linked securities (ILS) markets needn’t lose sleep over these changes.

Global reinsurance giant Hannover Re expects to witness greater stability in pricing and terms and conditions at the upcoming January 1st 2017 renewal season, but does expect the volume of reinsurance capital available to remain high.

Despite the fact hurricane Matthew impacted the U.S. coastline, as the first major hurricane to do so in a number of years, the economic loss of around $10 billion is only anticipated to result in around $5 billion of loss to insurance and reinsurance markets.

Reinsurance companies are accessing a greater volume of alternative capital through actively managed vehicles, while the collateralized reinsurance, industry loss warranty (ILW) and quote share reinsurance sub-sectors highlight ongoing ILS market growth, according to Aon Benfield.

The hedge fund reinsurance business model showed its potential in the third-quarter of 2016 with both Greenlight Re and Third Point Re reporting net income gains compared with a loss in the same period last year, although there was still evidence of divergent performance across the two businesses.