Reinsurance News

Global reinsurance giant Hannover Re expects the demand for insurance-linked securities (ILS) structures to grow in the coming years, and that reinsurance prices will show greater stability at January 1st 2017.

The reinsurance industry needs to get better at promoting the value of its catastrophe products to buyers, thinks Dominic Christian, Executive Chairman, Aon Benfield International. Property catastrophe reinsurance plays a vital societal role as well as generating significant premiums for the industry, he told Artemis ahead of the Rendez-Vous de Septembre in Monte Carlo.

When the global reinsurance market begins to turn from its softening cycle, issuers of catastrophe bonds will benefit from an increased demand for cover, according to JLT Re’s David Flandro.

The insurance and reinsurance run-off, or legacy transactions market has continued its growth path so far in 2016, a trend that is expected to continue. And as buyers look to access new capital providers it’s expected that pension funds and ILS vehicles will play an increasing role in the market, according to PwC.

While the long-term impact of alternative reinsurance capital and ILS on catastrophe re/insurance profits remains unclear, reinsurers such as Munich Re have an increasingly ability to cooperate with alternative capital to their own benefit, according to Torsten Jeworrek.

The reinsurance and broader risk transfer market is increasingly becoming a process  of matching risk to the right capital in the most efficient manner possible, with industry trends pointing to a need to accelerate the transport of risk to capital.

The reinsurance pricing cycle is close to bottoming out, according to Frank Majors, co-founder and principal of the world’s largest ILS fund manager Nephila Capital.

The reinsurance industry has been characterised by excess capital and capacity, but the increasing range of potential capital sources has been influencing reinsurance buying dynamics, meaning reinsurers need to be able to access the most effective capital for their clients.

Demand for customised risk transfer solutions are increasing within the reinsurance marketplace, according to reinsurance giant Swiss Re. The trend could result in large reinsurers coming under pressure from influential ILS fund managers, as they look to utilise the specialities and features common in the ILS sector.

Insurance and reinsurance firm Hiscox is expanding its insurance-linked securities (ILS) capabilities with the addition of a collateralised reinsurance offering, to complement its existing flagship Kiskadee ILS funds which already have over $1 billion of capital invested in them.