Reinsurance News

Close to US $20 billion of new capital was raised by the global reinsurance market and new start-up entrants in 2020 and there is more to come in 2021, as the need for capital persists, according to David Flandro of HX Analytics.

The Pioneer ILS Interval Fund, a dedicated insurance-linked securities (ILS) focused mutual investment fund strategy managed by Amundi Pioneer Investment Management, added almost 11% to its total net assets in the last quarter of record, while reporting an impressive 7.7% return for the full-year.

It turns out that MS Amlin was the sponsor behind the recently completed Phoenix 1 Re Pte. Ltd. (Series 2021-1) collateralised reinsurance sidecar transaction, which appears to have been the first sidecar to be solely focused on Asian property catastrophe risks.

The January 2021 reinsurance renewals were a more complex affair, which resulted in a trend to more non-concurrency in placements, according to broker Guy Carpenter. Which we believe suggests a need for the reinsurance market to embrace modernisation in the renewal process sooner, rather than later.

The U.S. Federal Emergency Management Agency (FEMA) has renewed the National Flood Insurance Program’s (NFIP) traditional reinsurance program at the January renewals, opting for a downsized $1.153 billion of coverage, but from an expanded panel of reinsurers.

The expected capacity shortage in the retrocessional reinsurance market did not materialise to the degree anticipated at the January 2021 renewals, resulting in a market that still firmed considerably, but did not experience the hardening many had been hoping for.

Issues related to the potential for insurance-linked securities (ILS) collateral to be trapped, because of uncertainty over the COVID-19 pandemic and its potential losses for the insurance and reinsurance industry, have largely been postponed until after the January renewals.

With the merger of insurance and reinsurance broking giants Aon and Willis Towers Watson (WTW) coming under increased scrutiny from regulators, analysts at KBW suggest that should reinsurance arm Willis Re have to be divested, AJG would be seen as the “best fit” to acquire the WTW unit.

Global risk-adjusted property catastrophe reinsurance rates-on-line rose by an estimated 6% at the January 2021 reinsurance renewals, according to analysis by Howden Broking.

The resilience of the global reinsurance market “shone through” at the January 2021 renewals, which broker Willis Re says were less onerous than feared for ceding companies.