Reinsurance sidecars news

Reinsurance recoveries are set to offer some respite to insurance carriers exposed to winter storm Uri and the deep freeze event that impacted the south, in particular Texas, according to S&P Global Ratings.

Mike Sapnar, the outgoing CEO of global reinsurance group TransRe, is heading for a new role at Stone Ridge Asset Management, the New York based asset manager with a focus on alternative risk premia strategies, according to sources and reports.

The fact cedents allowed insurance-linked securities (ILS) capital to be rolled over into reinsurance renewals rather than trapping it for potential losses from the pandemic, for the ILS market “amounts to kicking the can down the road for COVID-19-related losses,” according to AM Best.

February’s deep freeze and winter storm catastrophe event looks set to drive a property catastrophe reinsurance market loss of somewhere in a range from $10 billion to $12 billion, Leadenhall Capital Partners CEO Luca Albertini believes.

As the insurance-linked securities (ILS) pie continues to expand it’s natural for new jurisdictions to emerge and try to take a slice, but the innovative Bermuda marketplace is expected to maintain its leadership position, according to Ross Webber, Managing Director at independent financial services provider and fund administrator, Apex Group Ltd.

At the recent January 1st 2021 reinsurance renewals, the expectations for significant impairment to some insurance-linked securities (ILS) strategies because of trapped collateral due to exposure to the COVID-19 pandemic proved overblown.

The Progressive Corporation has revealed that its losses from the recent winter storms in the United States drove a $40 million reinsurance recovery for the firm, after claims exceeded its occurrence retention.

German reinsurance giant Munich Re said that it is expecting its losses from the recent US winter storm and extreme freezing weather event to be in the mid hundreds of millions of Euros.

Insurance and reinsurance industry catastrophe claims are likely running around 34% above the 10-year average for the year-to-date thanks to the significant contribution from US winter storms and freezing weather, according to analysts at Jefferies.

Bermuda headquartered ILS fund and investment manager ILS Capital Management, has said that it expects that industry losses suffered from the recent winter storms and Arctic blast in the United States will drive renewal rates higher at the mid-year and also further into 2022.