April 27th, 2015

GC Securities* Catastrophe Bond Update, First Quarter 2015

Posted at 1:00 AM ET

High-volume maturities coupled with a diverse and steady stream of new issuances created a dynamic market environment in the first quarter of 2015. The first quarter of each year is particularly active in terms of issuance for the property/casualty (P&C) catastrophe bond market, and this characteristic continued into 2015 as USD1.49 billion of 144A P&C catastrophe bond limit was successfully placed with investors, one of the highest first quarter volumes in the history of the 144A marketplace. However, the first quarter also had the highest ever volume of 144A P&C catastrophe bonds maturing, returning USD3.544 billion of principal to investors. As of March 31, 2015, USD20.813 billion of P&C 144A catastrophe bond risk capital was outstanding.

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April 26th, 2015

Guy Carpenter Unveils New Digital Strategy and Innovative Electronic Platform

Posted at 11:30 PM ET

Guy Carpenter today announced a new digital strategy, unveiling an innovative platform - GC Exchange℠ and its unique suite of electronic solutions, including GC MarketPlace℠ and GCReBID℠.

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April 24th, 2015

Week’s Top Stories: April 18 — 24, 2015

Posted at 8:00 AM ET

Guy Carpenter Launches New Public Sector Specialty Practice: Guy Carpenter announced the launch of the Public Sector Specialty Practice. This global team is focused exclusively on the unique risk management needs of governmental agencies and entities.

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Chart: Combined Ratio For Guy Carpenter Composite, YE 2014: Chart presents combined ratio for the Guy Carpenter Global Reinsurance Composite, 2004 through year end 2014.

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Evolving Role of Reinsurance in Public Sector Risk: Here we review the evolving role of reinsurance in mitigating public sector risk through the expanding deployment of reinsurance and capital market solutions.

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Chart: Global Property Catastrophe ROL Index 1990 to 2015: The Guy Carpenter Global Property Catastrophe Rate on Line (ROL) index is presented for 1990 through 2015.

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Risk Profile, Appetite, and Tolerance: Fundamental Concepts in Risk Management and Reinsurance Effectiveness: Prior to the recent turbulence in the financial markets, insurers and reinsurers were increasing their use of enterprise risk management (ERM) to make risk and capital management decisions. While this was driven in part by rating agencies and regulators, many carriers began to recognize the value of metric-based frameworks and capital models in evaluating their portfolios.

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And, You May Have Missed…

CFTC Provides Conditional Relief to Certain ILS/Cat Bond Issuers: On December 18, 2014 the U.S. Commodity Futures Trading Commission (CFTC) provided conditional relief to certain insurance-linked securities (ILS)/cat bond issuers from having to register as Commodity Pool Operators (CPOs).

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April 23rd, 2015

Review of Flood Peril

Posted at 1:00 AM ET

With the recent release of Guy Carpenter’s G-CAT® Canada flood model, we review earlier GC Capital Ideas stories on the flood peril: 

 

Malaysia Floods: December 2014-January 2015: In response to demand for detailed maps showing the extent of flooding in December 2014 through January 2015, Guy Carpenter activated its CAT-VIEW℠ event response service to produce flood footprints based on unmanned airborne vehicles (UAV) imagery.

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Guy Carpenter Publishes Flood Risks in Asia - A Detailed Study: Guy Carpenter released a new report titled Flood Risk in Asia - A Detailed Study. The report provides an in-depth study of the flood potential in Asia along with the prevention and protection systems in place.

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Guy Carpenter Launches Satellite-based Catastrophe Evaluation Service: Guy Carpenter launched its new satellite-based catastrophe evaluation service, GC CAT-VIEW℠, with the announcement that it has started using the service to provide clients affected by the recent UK floods with initial insured loss estimates.

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April 22nd, 2015

Evolving Role of Reinsurance in Public Sector Risk

Posted at 1:00 AM ET

Here we review the evolving role of reinsurance in mitigating public sector risk through the expanding deployment of reinsurance and capital market solutions: 

 

1. Capital Markets Developing Trends: Capital markets capacity continues to innovate as highlighted by the recent issuance of a catastrophe bond by the MTA . This issue, MetroCat, which came to market in July 2013, demonstrated the willingness of capital markets investors to assume storm surge and flood risk from named storms in a cost effective manner. 

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2. Public Entities, Insurers of Last Resort and Compulsory Cat Pools and Disaster Facilities: The use of capital markets-based risk transfer capacity by public entities, insurers of last resort, and compulsory catastrophe pools and disaster facilities continues to expand. These deals included Turkey’s Turkish Catastrophe Insurance Pool, Mexico’s FONDEN and New Zealand’s EQC. Most large U.S. insurers of last resort, such as CEA, Citizens (FL), Citizens (LA), North Carolina Joint Underwriting Association and the North Carolina Insurance Underwriting Association (NCJUA/NCIUA), and Texas Windstorm Insurance Association, are utilizing capital markets capacity including collateralized reinsurance and catastrophe bonds. 

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3. GC Securities* Completes First Catastrophe Bond Issued By The World Bank On Behalf Of The Caribbean Catastrophe Risk Insurance Facility: GC Securities announced the placement of Floating Rate CCRIF Catastrophe-Linked Capital at Risk Notes, with notional principal of USD30,000,000, issued by the International Bank for Reconstruction and Development, a member institution of the World Bank Group, to facilitate risk transfer on behalf of the Caribbean Catastrophe Risk Insurance Facility (the CCRIF).  CCRIF is a risk-pooling facility that is designed to limit the financial impact on its sixteen Caribbean member governments resulting from catastrophic earthquakes and hurricanes by quickly providing financial liquidity when a policy is triggered. This is the first time that the CCRIF has utilized the cat bond market and the first catastrophe bond directly issued by the World Bank.

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*Securities or investments, as applicable, are offered in the United States through GC Securities, a division of MMC Securities Corp., a US registered broker-dealer and member FINRA/NFA/SIPC. Main Office: 1166 Avenue of the Americas, New York, NY 10036. Phone: (212) 345-5000. Securities or investments, as applicable, are offered in the European Union by GC Securities, a division of MMC Securities (Europe) Ltd. (MMCSEL), which is authorized and regulated by the Financial Conduct Authority, main office 25 The North Colonnade, Canary Wharf, London E14 5HS. Reinsurance products are placed through qualified affiliates of Guy Carpenter & Company, LLC. MMC Securities Corp., MMC Securities (Europe) Ltd. and Guy Carpenter & Company, LLC are affiliates owned by Marsh & McLennan Companies. This communication is not intended as an offer to sell or a solicitation of any offer to buy any security, financial instrument, reinsurance or insurance product. **GC Analytics is a registered mark with the U.S. Patent and Trademark Office.

April 21st, 2015

Chart: Combined Ratio For Guy Carpenter Composite, YE 2014

Posted at 1:00 AM ET

Chart presents combined ratio for the Guy Carpenter Global Reinsurance Composite, 2004 through year end 2014.

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April 19th, 2015

Guy Carpenter Launches New Public Sector Specialty Practice

Posted at 11:30 PM ET

Guy Carpenter today announced the launch of the Public Sector Specialty Practice. This global team is focused exclusively on the unique risk management needs of governmental agencies and entities.

Continue reading…

April 17th, 2015

Week’s Top Stories: April 11 — 17, 2015

Posted at 8:00 AM ET

Chart: Global Property Catastrophe ROL Index 1990 to 2015: The Guy Carpenter Global Property Catastrophe Rate on Line (ROL) index is presented for 1990 through 2015.

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Chart: Source Of Earnings For Guy Carpenter Reinsurance Composite, YE 2014: Chart presents source of earnings for the Guy Carpenter Global Reinsurance Composite for the year end, 2014 compared to year end, 2013.

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Chart: Return On Equity For Guy Carpenter Reinsurance Composite, YE 2014: Chart presents return on equity for the Guy Carpenter Global Reinsurance Composite, 2004 through year end 2014.

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Guy Carpenter Launches New G-CAT® Canada Flood Model: Guy Carpenter launched its new G-CAT® Canada Flood Model. In creating the first ever probabilistic flood model for Canada, Guy Carpenter has enabled insurers to assess their exposure to flood, Canada’s most frequently occurring natural hazard.

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Risk Profile, Appetite, and Tolerance: Fundamental Concepts in Risk Management and Reinsurance Effectiveness: Prior to the recent turbulence in the financial markets, insurers and reinsurers were increasing their use of enterprise risk management (ERM) to make risk and capital management decisions. While this was driven in part by rating agencies and regulators, many carriers began to recognize the value of metric-based frameworks and capital models in evaluating their portfolios.

Read the article>> 

 

And, You May Have Missed…

GC Videocast - Overview of the Holistic Balance Sheet Management Framework and Application: Eric Paire, Head of Strategic Advisory EMEA, Guy Carpenter, presented the sixth part of the Holistic Balance Sheet Management series describing the “multi-layer” approach that Guy Carpenter and Mercer will adopt when working exclusively with insurance clients to holistically manage capital and strengthen balance sheets. The approach includes an extensive evaluation of the investment and reinsurance portfolios to understand client needs, an assessment of the rationale for freeing-up and/or moving capital and a consideration of  modeling aspects such as the Solvency II standard formula, internal models or rating agency models.

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April 16th, 2015

Guy Carpenter Launches New G-CAT® Canada Flood Model

Posted at 6:30 AM ET

Guy Carpenter today launched its new G-CAT® Canada Flood Model. In creating the first ever probabilistic flood model for Canada, Guy Carpenter has enabled insurers to assess their exposure to flood, Canada’s most frequently occurring natural hazard.

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April 16th, 2015

Chart: Return On Revenue For Guy Carpenter Reinsurance Composite, YE 2014

Posted at 1:00 AM ET

Chart presents return on revenue for the Guy Carpenter Global Reinsurance Composite, 2004 through year end 2014.

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