Archive for December, 2017

The decoupling of reinsurance pricing and expected reinsurance losses is “a less-than-ideal business model” according to analysts at Keefe, Bruyette & Woods, who feel that price hikes tend to be a reaction to losses, rather than being commensurate with a changing view of risk.

The International Monetary Fund (IMF) is putting its weight behind calls for the use of catastrophe bonds to help the Caribbean nations to increase their resilience to and ability to recover from disasters, after a hurricane season that has impacted the region heavily.

Negative returns have continued for a number of insurance-linked securities (ILS) and reinsurance or retrocessional linked investment funds in November, as some reserve strengthening has been required for prior month catastrophe events and a few ILS funds have been hit by the California wildfires.

Global asset management firm, Baillie Gifford, is unlikely to significantly increase its allocation to the insurance-linked securities (ILS) space until spreads widen, according to Baillie Gifford’s David McIntyre, one of the managers of its Diversified Growth Fund.

Speed-to-market remains the main sticking point for the United Kingdom’s Risk Transformation Regulations 2017 and the Risk Transformation (Tax) Regulations 2017, which constitute the UK’s insurance-linked securities (ILS) regulatory regime, according to law firm Clyde & Co.

While the record levels of third-quarter catastrophe losses are expected to “crystalize a turning point” by the equity analysts at Morgan Stanley, the team believe that this any post-loss turn in rates will be more durable in primary insurance lines than in reinsurance or retrocession.

German reinsurance giant Hannover Re has facilitated another private catastrophe bond transaction, with the issuance of a $10 million LI Re (Series 2017-1) deal that securitises California earthquake reinsurance risk for an unknown cedent and certain ILS investors.

German reinsurance firm Hannover Re has facilitated a second private catastrophe bond this month with the completion of a $27 million Seaside Re (Series 2018-3) transaction, the second series of cat bond notes to be issued through its Kaith Re Ltd. Bermuda domiciled segregated accounts vehicle in recent days.

Reinsurance Group of America (RGA) has completed a £900 million reinsurance transaction covering a portfolio of annuity business from UK insurer Liverpool Victoria (LV=), in a deal that saw both the asset and longevity risk transferred.

Severe thunderstorms that struck the Victoria and Melbourne region of Australia on December 19th, bringing strong winds, large hail and flash flooding, are estimated to have already resulted in over AU $105 million of claims, a figure that is expected to rise significantly.