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).
Managers of insurance-linked securities (ILS) funds and other strategies are pushing back on what is seen as still excessive trapping of capital linked to COVID-19 related claims, as confidence rises that the eventual impacts of this will be relatively limited for the ILS market.
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Current market conditions make allocating to the catastrophe bond asset class a particularly attractive prospect for investors at this time, according to Twelve Capital Founding Partner & Group CIO, Dr. Urs Ramseier.
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Despite attempts to reform the Florida property insurance market and the fact newly litigated claims dropped in February 2022, the litigation exposure of P&C insurance carriers in the state remains a concern, according to Wesley Todd, CEO of CaseGlide.
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Markel continues to drive increasing volumes of catastrophe exposed property business through the reinsurance vehicles owned by its insurance-linked securities (ILS) manager Nephila Capital, with the amount of premium ceded through such programs rising 67% year-on-year in 2021.
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The proposed buy-out schemes for the Markel CATCo retrocessional reinsurance investment funds have now received formal support from the US bankruptcy courts and Markel said yesterday that two lawsuits filed against former Markel CATCo CEO Tony Belisle will now be dismissed with prejudice, as the buy-out offer moves towards its close.
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Rate increases alone are no longer considered sufficient to improve the underwriting results of insurance-linked securities managers and reinsurance firms, according to AM Best, who believes that after consecutive years of heavy catastrophe losses the only answer is continued improvement of the quality of portfolios of risk.
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The new Matterhorn Re Ltd. (Series 2022-1) catastrophe bond transaction from global reinsurance giant Swiss Re has now been priced and sources told Artemis that the issuance was upsized by 63% to $325 million in size, while both tranches of notes priced at the lower-ends of guidance.
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Gaining closure over the Markel CATCo retrocessional reinsurance investment funds cleared another hurdle for parent Markel today, after a Bermuda Court sanctioned the proposed schemes to implement the buyout process.
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While investor appetite for insurance-linked securities (ILS) has been tested by consecutive years of elevated catastrophe losses, the asset class still plays an important role for many allocators and there remains an appetite to invest in new classes of risk, while differentiation is also an important consideration.
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Global reinsurance company Hannover Re could find some support from its capital markets backed K-Cessions quota share sidecar facility for certain non-war specialty lines exposures to the ongoing conflict in Ukraine.
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