Collateralized reinsurance news

Investors in the insurance-linked securities (ILS) space are demanding discipline from managers in the wake of recent loss events and subsequent loss creep, while an elevated need for comfort is leading to a surge in demand for proportional deals, according to industry experts.

With retrocessional reinsurance capacity expected to be constrained at the January 2020 renewals, particularly collateralised from the insurance-linked securities (ILS) market, some reinsurers and in particular Lloyd’s players may have to rethink their premium growth plans, analysts have suggested.

Malta still has ambitions to eventually become a hub for insurance-linked securities activity, according to leaders from local re/insurance industry bodies, but barriers to entry continue to present a significant challenge for the jurisdiction.

The General Insurance Association of Japan (GIAJ) has reported that already domestic insurers in the country have paid out just under US $2.5 billion for claims from typhoon Faxai, while for more recent typhoon Hagibis the claims are still mounting up.

The U.S. Federal Emergency Management Agency (FEMA) is expecting to secure orders and authorisations for a January 2020 renewal of the National Flood Insurance Program’s (NFIP) traditional reinsurance program in the coming days.

MS&AD Holdings, the Japanese parent to domestic insurance carriers Mitsui Sumitomo and Aioi Nissay Dowa Insurance, as well as its international operation MS Amlin, has revealed today that it expects its ultimate loss from typhoons Hagibis and Faxai will be approximately US $3.36 billion, before reinsurance recoveries.

Loss creep from hurricane Irma has remained evident for the major insurers operating in Florida in the third-quarter of the year, but the impact to reinsurance markets is slowing and the Florida Hurricane Catastrophe Fund (FHCF) has been soaking up much of the new claims inflation, at least from larger players.

Horseshoe, the Bermuda-headquartered specialist ILS, insurance or reinsurance management and fund administration, servicing, and risk transformation specialist, is now owned by Artex Risk Solutions, as the acquisition completed today, creating the largest ILS service firm that will operate under the Horseshoe brand.

A severe hail storm struck the Brisbane and Sunshine Coast region of South Queensland, Australia yesterday, resulting in widespread damage, with thousands of insurance claims already filed.

Everest Re’s new and incoming CEO Juan C. Andrade sees a range of opportunities presented by current market conditions, among which are increased use of third-party reinsurance capital and also underwriting in the retrocession market.