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Rate adequacy & claims inflation “the most critical question” – Niklaus Hilti interview


In the current macro-economic environment, it is critical the reinsurance and insurance-linked securities (ILS) markets get to grips with inflation and making sure it is priced for, Niklaus Hilti explains in a new Artemis Live video interview.

niklaus-hilti-credit-suisse-ils-jun-2022Our latest Artemis Live video interview from June 2022 is with Niklaus Hilti, Head of ILS at specialist investment manager Credit Suisse Insurance Linked Strategies.

Hilti joined us at a particularly busy and interesting time for the reinsurance, insurance-linked securities (ILS) and broader capital markets.

We discussed the macro-economic environment and how that plays into reinsurance and ILS market trends, as well as the catastrophe bond market, the mid-year 2022 reinsurance renewals, the state of Florida’s property insurance market and the outlook for the rest of the year.

Hilti also explained how his firm, Credit Suisse Insurance Linked Strategies, has been working hard to deliver on its promises to investors, taking advantage of hardening reinsurance market conditions to reposition its portfolio and tighten up terms and conditions.

One topic of focus in this interview is the global inflationary environment and how inflation needs to be factored into reinsurance and ILS market pricing.

He explained, “If today a hurricane or earthquake event happens again, a historical one, it would be significantly more expensive than what is captured already in the most update model version.

“Then if you look at cat bonds, let’s say a three year placement, you have to think as well, what’s the claims inflation over the next three years.

“It’s something which needs to be factored in and that raises the question of how adequate is the pricing, or how much did we really see a real, real increase of margin or premium with the latest premium increases. For us, that is the most critical question at the moment.”

The full video interview is embedded below and can also be viewed in full, along with previous Artemis Live video interviews, over on our YouTube channel.

You can also listen in audio to all of our interviews by subscribing to the Artemis Live podcast here.

All of our Artemis Live video interviews have a focus on reinsurance, ILS and the efficiency of risk transfer and can be accessed directly from our YouTube Channel.

You can also listen in audio to these interviews by subscribing to the Artemis Live podcast here.

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Register today for ILS Asia 2023, our next insurance-linked securities (ILS) market conference. Held in Singapore, July 13th, 2023.

Artemis ILS Asia 2023 - Insurance-linked securities conference in Singapore

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