Alternative reinsurance capital

Multi-line U.S. primary home and auto insurer Mercury General Corporation has significantly increased the size of its reinsurance program, in the wake of Californian wildfire losses that had burned through its tower in the prior year.

Everest Re saw its fully collateralized reinsurance sidecar and segregated accounts vehicle Mt. Logan Re shrink slightly during the second-quarter of 2019, but at the same time the reinsurer grew its shareholders equity significantly, taking its overall capital base to a new high of $13.4 billion.

For some year’s now we’ve been saying that insurance-linked securities (ILS) capacity and alternative reinsurance capital is destined to get closer to risk, as structures and technologies advance to allow it to break free from the strictures of the traditional market chain.

In reporting its results today, insurance and reinsurance firm Hiscox Group explained that rate momentum continues to build and price increases have been accelerating at renewals so far in 2019, while its Hiscox Re & ILS unit continues to find attractive opportunities in retrocession.

Here are the ten most popular news articles, week ending 28th July 2019, covering catastrophe bonds, ILS, reinsurance capital and related risk transfer topics. To ensure you never miss a thing subscribe to the weekly Artemis email newsletter updates or get our email alerts for every article we publish.

The insurance and ultimately reinsurance market caused by damage to and the resulting production shutdown of the Kwame Nkrumah FPSO (floating production, storage and offloading) vessel operating on the Jubilee oil field, Ghana, looks closer to settling as the loss creep from business interruption has slowed down.

RenaissanceRe deployed more capacity into retrocession again at the recent mid-year reinsurance renewals, managing to provide continuity to some protection buyers that were missing the availability of Markel CATCo’s retro product.

Beazley continues to try and drive down the cost of re/insurance capital using its so-called ‘smart tracker’ special purpose arrangement (SPA) syndicate 5623, with digitalisation a goal to add further efficiency in the future.

The recent earthquakes that struck a sparsely populated region of California near the town of Ridgecrest are expected to drive around $200 million of economic losses, but only up to $40 million is expected to be covered by insurance.

RenaissanceRe said that it raised over $700 million of new third-party capital from investors for its joint-venture and insurance-linked securities (ILS) vehicles in the second-quarter of 2019.