Reinsurance News

The development of the insurance-linked securities (ILS) market has helped to enlarge global reinsurance capacity, according to SCOR one of the world’s largest traditional reinsurers, and the firm says alternative capital is a complement to reinsurance, not a substitute for it.

The reduced profitability of global reinsurers will be a key risk for the industry in 2017 warns Fitch Ratings, suggesting that some companies could see their ratings impacted by profit deterioration. Fitch also warns that reports of stabilised prices are a false hope for increased reinsurance profits.

Brent Slade, the Chief Operating Officer (COO) of ILS and reinsurance management, servicing, transformation and fronting specialist Horseshoe Group, has underlined innovation in the insurance-linked securities (ILS) market as a “bright light” in the softening global reinsurance market.

The softening reinsurance market cycle has persisted for longer than many market players and observers had anticipated, suggesting that global reinsurance industry returns will likely weaken further, according to analysis from Standard & Poor’s (S&P).

For the third consecutive month U.S. commercial P&C rates declined by an average of 1% during August, as insurers look to put a stop to any further rate reductions, according to market analysis from MarketScout and Keefe, Bruyette & Woods (KBW).

Welcome to our 2016 Artemis Flood & Protection Gap Roundtable in partnership with Swiss Re, in which participants explore the issues surrounding global flood insurance coverage, the resulting protection gap and how traditional and capital markets can assist to narrow this.

The growth of ILS capacity backed by capital market investors in the global reinsurance market is “pressuring the reinsurance sector to work to charge less” according to A.M. Best, pressure that is not decreasing with alternative and ILS capital now contributing 20% of the markets capacity

Growth in longevity reinsurance and longevity risk transfer business could help life reinsurers to elevate their returns on equity (ROE) above 10%, but at the same time there is an expectation that growing demand for longevity capacity will change reinsurers risk profiles, according to S&P.

Despite catastrophe losses in the first-half of 2016 being above the long-term average, “only the most severe event” would result in any meaningful turn from the soft reinsurance pricing, according to analysis from RBC Capital Markets.

Up to Friday evening hurricane Hermine is estimated to have caused an insurance and reinsurance industry loss approaching $500m, with economic loss approaching $1 billion, according to catastrophe risk management and modelling firm Karen Clark & Company (KCC).