November 10th, 2010

Chart: Global Reinsurance Composite: Average price to book ratio

Posted at 1:00 AM ET

This chart shows the price to book ratio of the global reinsurance sector over two decades. These valuations are clearly volatile and affected by cyclical pricing, investment returns, and by the impact of large catastrophes. Given the current operating environment and market conditions, investors appear to believe near-term profitability will be low.

reinsurance-decision-2

Note: “9/11″= Terrorist attacks of September 11, 2001

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