Reinsurance News

Speaking yesterday, Mac Armstrong, the CEO of Palomar Insurance Holdings, the speciality California-headquartered insurer that offers largely catastrophe exposed property products, disclosed exposure via a single counterparty to the Vesttoo-linked collateral issues, but said this is “immaterial” and could actually constitute an opportunity for his firm.

While the general opinion in the insurance and reinsurance industry is that the outlook for the Florida marketplace is improved and the reforms, while taking time to bed in, will deliver benefits to insurers, the carriers operating there continue on their path of exposure management, by any means necessary.

Higher assets under management and improved returns in the insurance-linked securities (ILS) funds and sidecar structures managed by Swiss Re’s Alternative Capital Partners (ACP) division have driven a significant increase in fee income and commissions earned by the reinsurer in the first-half of 2023.

Root Insurance, the auto lines focused insurtech that also bundles coverage with renters and homeowners products, has exposure to a reinsurance arrangement with links to Vesttoo, but the company’s CFO said it would feel comfortable commuting that and retaining the risk, if it needed to.

Announcing its quarterly and half-year results this morning, global reinsurance giant Swiss Re has shown the effects of improved market conditions, with its P&C reinsurance arm delivering stronger results thanks to lower catastrophe impact and higher margins.

Insurance focused investment manager Conning has commented on the news about fraudulent or forged collateral linked to reinsurance deals facilitated by insurtech Vesttoo, suggesting it could add pressure to MGA’s negotiations for capacity deals.

Speaking today during the Markel second-quarter earnings call, Jeremy Noble, President of Insurance explained that the team at insurance-linked securities (ILS) fund manager Nephila Capital are working hard to make the most of the attractive reinsurance pricing environment.

According to the CFO of specialty re/insurer AXIS Capital, the company decided not to renew a catastrophe bond this year and he said he feels better as a result, as doing so removed some of the basis risk from AXIS’ reinsurance arrangements.

Responding to media reports about the removal of senior co-founders and the potential dismantling of the company, the Board of under-fire insurtech Vesttoo has issued a statement saying they have “no plans to liquidate the company.”

Australian regulator of banks, insurers and pensions, the Australian Prudential Regulation Authority (APRA), has highlighted the viability of insurance-linked securities (ILS) and catastrophe bonds as reinsurance alternatives, saying it recognises their benefits and permits them under the calculation of insurance concentration risk charges.