Reinsurance News

The insurance and perhaps reinsurance industry loss due to UK flood damage caused by storms Eva & Frank in December and other low pressure systems in January, is estimated to have cost the industry £526 million ($770m or €685m), according to PERILS AG.

Blue Capital Reinsurance Holdings Ltd. (BCRH), the New York stock exchange listed collateralized reinsurer, has reported an impressive 11.4% total return for 2015, based on book value per share growth inclusive of dividends.

Some reinsurance lines are no longer meeting cost-of-capital for the world’s largest reinsurers, which sees the firms often writing business at levels which are technically unprofitable as they subsidise some risks as diversifiers.

The scale of Everest Re’s fully collateralised reinsurance sidecar Mt. Logan Re Ltd. was evident in the reinsurers 2015 results, as the underwriting gain increased significantly year-on-year, although there was no change in size of the vehicle in the fourth-quarter.

Global reinsurance player Munich Re has reported lower returns on capital and on equity for 2015, although profit remained stable, perhaps giving a glimpse into a new normal for the large reinsurers as returns are squeezed by price pressures and competition.

Bermudian reinsurance company and third-party capital management specialist RenaissanceRe increased the managed catastrophe premiums it underwrote during the fourth-quarter of 2015, year-on-year, and also looks to have raised some new capital from third-party investors.

The London and Bermuda stock exchange listed reinsurance and insurance linked securities (ILS) investment fund, the Blue Capital Global Reinsurance Fund, has reported a total Net Asset Value (NAV) return, inclusive of dividends, of 9.6% for 2015, up on its prior-year performance.

The insurance and reinsurance industry loss from the Tianjin, China port explosions last summer could creed up to somewhere between $5 billion to as much as $6 billion, according to reports, threatening a growing loss exposure for some ILS funds.

Reinsurance firm PartnerRe noticed “further erosion of prices and terms, driven by an oversupply of capital” according to its President Emmanuel Clarke, as the reinsurer reported a decline in premiums of 5% at the January renewals.

German reinsurance firm Hannover Re, one of the world’s largest and most diverse, said that conditions in the reinsurance market at the key January renewal remained “essentially unchanged year-on-year” but that there were signs of rate stabilisation among the competitive conditions.