Swiss Re Insurance-Linked Fund Management

Original Risk: A Society for Change Agents

Industry pushed to rethink & retool: Faries, Tokio Millennium Re


Following the impacts of 2017 catastrophe events and the subsequent impressive response from the insurance-linked securities (ILS) industry, Kathleen Faries, Head of Tokio Millennium Re’s Bermuda branch, believes that in terms of the rate and return environment, this is the new market.

Speaking with A.M. BestTV at the Artemis 2018 NYC ILS conference, held recently in Manhattan, Faries said that for Tokio Millennium Re, “We do view this as the new market, in terms of the rate environment and the return environment that we’re in.”

Throughout the event it was highlighted by both speakers and attendees how well the ILS investor and sponsor base reacted to the large catastrophe losses experienced in the third and fourth quarter of 2017.

Fears of investors running from the sector when losses arise appear to have been put to bed, underlined by the response of the market and the willingness of investors to replenish capital in time for the January 1st, 2018 renewals season.

Regarding investors and the cat events of 2017, Faries said; “The way they responded showed that they’re in it for the long-term, they’re not afraid to take a loss, they didn’t retreat. I think we’ve got a really stable pool of capital now, which is great for the industry and great for consumers.”

However, the new market reality is going to be a struggle for some markets, warned Faries, highlighting how many Bermudian companies in particular, Tokio Millennium Re included, have been built up during a very different rate environment, in terms of their operating platform and their infrastructure.

“It is not to say that we can’t adapt, which we will, but we all have to think that through. So, we all have to think now about retooling and automating and really getting efficient, which again, I think will be good for the industry and good for consumers, that we are kind of now, I believe, at that tipping point to push the industry to rethink and retool,” said Faries.

Faries was just one of the industry leaders speaking at our Artemis 2018 NYC ILS conference on February 2nd 2018.

The full interview with Kathleen Faries can be seen below:

Register today for ILS NYC 2023, our next insurance-linked securities (ILS) market conference. Held in New York City, February 10th, 2023.

Artemis ILS NYC 2023 - Insurance-linked securities conference in New York City

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