Fintech

Brokers face increasing pressures, with revenue and profitability likely to continue to be impacted due to the softening reinsurance market environment, but one bright spot could be the growing alternative markets according to rating agency Fitch, while another could be technology.

Farmers in Kenya are set to benefit from the launch of a new innovative, index insurance scheme which utilises advanced technology and satellite data to assist agricultural workers in the face of flooding and drought conditions.

Global reinsurance player Swiss Re has released its own measure of earnings performance today, reporting lower Economic Value Management (EVM) income and profit in 2015. But, perhaps more interestingly, the firm also noted its willingness to disrupt and bypass traditional channels to access risk.

Three Argentinian enterprises have joined forces to develop climate index futures to help agricultural producers to better protect themselves against the impacts of severe or inclement weather, with drought the first targeted product launch.

The challenges faced by traditional reinsurance firms are likely to “extend beyond a normal soft market cycle” as factors such as the growth of alternative capital, changes to the value-chain and higher regulatory costs all weigh on reinsurers, according to Fitch Ratings.

The insurance and reinsurance industry should expect further disruption as financial sectors with inefficient cost structures and high capital usage face threats from new entrants, business models, technology and alternative sources of risk capital, according to Oliver Wyman.

As the insurance-linked securities (ILS) sector continues to mature, market participants have an opportunity to collaborate with technology firms to develop tools that can move the industry forward, according to insurance and reinsurance software provider Xuber.

Insurance-linked securities (ILS) industry veterans Stefano Sola and Richard Pennay have launched a new technology focused ILS firm, Rewire Holdings LLC, seeking to increase efficiency in the syndication of catastrophe risk to reinsurance and capital markets.