All of our news and analysis on the retrocessional reinsurance marketplace.
Retrocession is effectively reinsurance for reinsurers, so a tertiary layer of risk transfer away from the original risk, if you consider primary, reinsurance and then retrocession.
As reinsurance is insurance for insurers, retrocessional, or retro, protection is reinsurance for reinsurers.
The retrocession reinsurance market has increasingly come to depend on the capital markets and insurance-linked securities (ILS).
As of mid-year 2022, global retrocession capacity has been estimated to be as high as $60bn, around $20bn of which is indemnity based and the rest in other formats.
The alternative capital markets and ILS funds, or investors, play a significant role in global retrocession, as too do instruments such as catastrophe bonds and industry-loss warranties (ILW).
Global reinsurance firm Swiss Re, through its specialist insurance-linked securities (ILS) fund management unit Swiss Re Insurance-Linked Investment Management Ltd (SRILIM), has secured a US $250 million investment into its 1863 ILS fund platform from the largest Swedish private pension Alecta.
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The fraud lawsuit involving former CATCo CEO Tony Belisle has been stayed pending a Bermuda Supreme Court decision on the insolvency and winding-down of the Markel CATCo retrocessional reinsurance funds.
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Ariel Re, the Bermuda-headquartered international reinsurance company, has announced an upsized commitment from Warren Buffett’s giant conglomerate Berkshire Hathaway, with an investment and quota share arrangement expected to drive further growth.
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We can now report that it was Toa Re Europe, the Switzerland-based European reinsurance arm of Japanese group Toa Reinsurance Company Ltd., that sponsored the recent $25 million Artex SAC Limited – Silver Crane Notes private catastrophe bond transaction, as it looks to expand its relationships with ILS investor markets.
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The insurance-linked securities (ILS) investment industry is experiencing a shift driven by changing investor priorities and this is playing to the strengths of firms with deep expertise such as Hiscox, according to Vincent Prabis.
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Validus, one of the AIG reinsurance brands under AIG Re, is the first to complete a 144A catastrophe bond issuance in 2022, starting the year off with a successful $400 million Tailwind Re Ltd. (Series 2022-1) transaction, that renews a capital market backed source of retrocession for the company.
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The recently completed repeat of a landmark Asian property catastrophe risk collateralised reinsurance sidecar arrangement by MS Amlin was backed by a number of Asian investors, the company has revealed.
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According to international broking group Howden, non-marine catastrophe retrocession rates-on-line for excess-of-loss coverage rose by an average of 15% at the key January 1st 2022 renewal season, outpacing property catastrophe treaty reinsurance rates-on-line by around 6%.
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At the January 2022 reinsurance renewals, some buyers of protection were left surprised after insurance-linked securities (ILS) fund capacity proved to be even less abundant than previously assumed, according to James Vickers, Chairman International, Reinsurance at Gallagher Re.
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The January 1st 2022 reinsurance renewal season has been particularly challenging, according to Gallagher Re CEO James Kent, with most parties emerging bruised but satisfied after a prolonged set of negotiations that dragged on late due to market losses and capacity issues.
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