Chart: Top Ten Catastrophe Bond Transactions for 2015: The table lists the top ten catastrophe bond transactions that were completed in 2015.
Rates That Reflect Risk: Insurance marketplaces that are stable and viable in the long-term succeed when insurers offer policies and coverages at premium rates that are appropriate and are subject to the requirements and standards of not being excessive, inadequate or unfairly discriminatory. At the same time, premium rates should be balanced and take past and prospective loss and expense experience into consideration. When these factors are not successfully accomplished, a public sector solution often emerges.
Chart: Global Property Catastrophe ROL Index 1990 to 2016: The Guy Carpenter Global Property Catastrophe Rate on Line (ROL) index is presented for 1990 through 2016.
Guy Carpenter Reports Stable Capital at January 1, 2016 Renewals: Guy Carpenter & Company reports that overall capital levels dedicated to reinsurance have stabilized, showing no growth for the first time in several years. In a highly competitive environment, companies assessed broader opportunities and the rate of incoming capital slowed. However, moderate loss experience kept capacity at abundant levels for the January 1, 2016 renewals. The continued scarcity of costly catastrophe losses and more than adequate capacity led to reinsurance pricing reductions, although there are signs the rate of descent is slowing as compared to 2015.
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 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.
And, You May Have Missed…
Reserving and Capital Setting: Sizing the Problem: There are three main questions to be tackled in sequence:
1. Which emerging risks potentially expose my company?
2. What means do I have to quantify those risks?
3. How are these risks likely to crystalize?
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