Reinsurance News

The Florida Hurricane Catastrophe Fund (FHCF) successfully renewed its $1 billion reinsurance program at June 1st 2018, with significant insurance-linked securities (ILS) fund and collateralized reinsurance vehicle participation.

It was the “tsunami of alternative capital” that kept a lid on reinsurance rates and prevented a market turn after the major losses of 2017, but at the same time may have helped to stimulate more focus on rate adequacy in other lines of reinsurance business, according to the CEO of W.R. Berkley.

The increased size of Markel CATCo Investment Management Ltd.’s assets under management, to which it added another $700 million to meet mid-year demand for its retrocessional reinsurance products, has helped the firm to underwrite a 30% larger mid-year book at the same rates as its January portfolio was secured.

The reloading of capacity after the 2017 catastrophe losses showed that the scare factor has gone for investors, according to S&P analyst Taoufik Gharib, meaning that fears of a softer-for-longer rate environment are unlikely to deter capital providers and as a result rate momentum is likely to fade in 2019.

Hail can drive as much as 70% of all U.S. severe convective weather and severe thunderstorm losses for the insurance and reinsurance industry, with another $10 billion plus year of hail related economic impacts expected for the country in 2018.

Losses from natural catastrophes and man-made disaster events are estimated to have cost the insurance and reinsurance industry $20 billion in the first-half of 2018, well down on the $35 billion average, according to global reinsurer Swiss Re.

AXIS Capital Holdings Limited, the Bermudian insurance and reinsurance specialist, is seeking to modernise its reinsurance underwriting and portfolio management operations at AXIS Re, with the establishment of a new Product Center that will be led by ex-PartnerRe executive Marcus Pollack.

Despite the constant reports of overcapitalisation in reinsurance, S&P reports that the top 20 reinsurance firms in the world have lost their capital redundancy at the ‘AAA’ confidence level for the first time since the financial crisis back in 2008.

Collateralized reinsurer Oxbridge Re Ltd. is looking to become more of an asset manager in the reinsurance space with its newly licensed Cayman Island’s sidecar vehicle, Oxbridge Re NS Ltd., according to its Chairman and Chief Executive Officer (CEO), Jay Madhu.

Australian primary player Insurance Australia Group (IAG) has spent significantly more on its reinsurance protection in the last six months and added stop-loss protection to cover it when catastrophe losses go above its natural perils budget and servicing a larger overall program.