Archive for the ‘Week in Review’ Category



January 18th, 2019

Week’s Top Stories: January 12 - 18, 2019

Posted at 10:00 AM ET

Reinsurance Rate Movement Limited at January 1 Despite Uncertainty over Pricing Adequacy and Available Capital: The overall impact of catastrophe losses on property rates was muted at the January 1, 2019 reinsurance renewals, but the fourth highest annual catastrophe loss year on record did create questions over pricing adequacy, underwriting strategy and the amount of capital available, says Guy Carpenter.

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Balance Sheet Expansion: Opportunities and Challenges: From 2014 to 2017, the property and casualty (P&C) industry in the United States grew its collective capital position from USD 686 billion to USD 767 billion, a 3.8 percent compound annual growth rate. This expansion in capital was achieved during a period when the normalized return profile of the P&C underwriting business was considered to be below the cost of capital. The growth of industry capital during this period of subpar underwriting returns provides insights into the expectations for carriers’ opportunities and challenges through 2018 and into the years ahead.

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Top Financial and Professional Lines Risks in 2019: The U.S. market for financial and professional insurance coverage saw a number of challenges in 2018, including new privacy regulations, an increase in workplace sexual harassment claims as the #MeToo movement continued to gain traction, and more securities litigation activity, says a report by Guy Carpenter’s sister company, Marsh.

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Global Risks Report: Heightened Geopolitical and Geoeconomic Tensions: Profound political, economic, societal, technological and environmental transformations are occurring at an unprecedented scale and pace and have become a part of day-to-day business life, according to the 14th edition of The Global Risks Report, prepared by the World Economic Forum (WEF) with the support of Marsh & McLennan Companies and other partners.

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Cost of Capital and its Use in Valuing Reinsurance: Increasingly, reinsurance is seen as an important element of capital management. Reinsurance decisions are moving away from the reinsurance buyer and towards the finance teams. These teams need to find a way of comparing reinsurance in a straightforward way. Defining the cost of capital for reinsurance means that it can be compared with other capital sources.

Read the article>>


And, you may have missed …

Taiwan: Catastrophe Insurance and Gap in Coverage: Taiwan has experienced a series of extreme weather events in recent years, which are expected to continue into the future, says the report 14 Shades of Risk In Asia-Pacific: Evolving Risk Concerns in Asia-Pacific by Marsh & McLennan Companies’ Asia-Pacific Risk Center.

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January 11th, 2019

Week’s Top Stories: January 5 - 11, 2019

Posted at 10:00 AM ET

Taiwan: Catastrophe Insurance and Gap in Coverage: Taiwan has experienced a series of extreme weather events in recent years, which are expected to continue into the future, says the report 14 Shades of Risk In Asia-Pacific: Evolving Risk Concerns in Asia-Pacific by Marsh & McLennan Companies’ Asia-Pacific Risk Center.

Read the article >>

Sydney Hailstorms, December 20, 2018: A severe convective storm affected large parts of New South Wales, including Sydney, the Central Coast and Wollongong from 4:00 to 7:00 pm on December 20, 2018. The storm generated large hail, damaging winds and flash flooding in many areas of the state. According to the Australian Bureau of Meteorology (BOM), there were ground reports of hail of 8 cm diameter in Berowra Heights in Sydney’s north and similar size hail in Casula and Liverpool in the city’s southwest.  The Nattai National Park west of Picton also experienced large hail. Initial damage reports indicated that the suburbs of Berowra Heights, Hornsby, Liverpool, Gosford and Lithgow were the most severely affected. Given that the event occurred during the Christmas holidays, many residents and businesses have not fully assessed the extent of damages; therefore, loss estimates are expected to increase in the next few weeks.

Read the article >>

Balance Sheet Expansion: Opportunities and Challenges: From 2014 to 2017, the property and casualty (P&C) industry in the United States grew its collective capital position from USD 686 billion to USD 767 billion, a 3.8 percent compound annual growth rate. This expansion in capital was achieved during a period when the normalized return profile of the P&C underwriting business was considered to be below the cost of capital. The growth of industry capital during this period of subpar underwriting returns provides insights into the expectations for carriers’ opportunities and challenges through 2018 and into the years ahead.

Read the article >>

A Math Formula May Offer a Solution to Insurers’ Critical Challenges: Guy Carpenter has developed a methodology that applies a mathematical formula to provide insurers and reinsurers with a unified, practical framework for risk pricing and capital allocation.

Read the article >>

Cost of Capital and its Use in Valuing Reinsurance: Increasingly, reinsurance is seen as an important element of capital management. Reinsurance decisions are moving away from the reinsurance buyer and towards the finance teams. These teams need to find a way of comparing reinsurance in a straightforward way. Defining the cost of capital for reinsurance means that it can be compared with other capital sources.

Read the article>>

And, you may have missed …

Cyberattacks Top Risk to Doing Business in India: A growing dependency on data and digitization efforts have increased the risks of cyberattacks in India, says the report 14 Shades of Risk In Asia-Pacific: Evolving Risk Concerns in Asia-Pacific by Marsh & McLennan Companies’ Asia-Pacific Risk Center.

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January 4th, 2019

Week’s Top Stories: December 29, 2018 - January 4, 2019

Posted at 10:00 AM ET

Sydney Hailstorms, December 20, 2018: A severe convective storm affected large parts of New South Wales, including Sydney, the Central Coast and Wollongong from 4:00 to 7:00 pm on December 20, 2018. The storm generated large hail, damaging winds and flash flooding in many areas of the state. According to the Australian Bureau of Meteorology (BOM), there were ground reports of hail of 8 cm diameter in Berowra Heights in Sydney’s north and similar size hail in Casula and Liverpool in the city’s southwest.  The Nattai National Park west of Picton also experienced large hail. Initial damage reports indicated that the suburbs of Berowra Heights, Hornsby, Liverpool, Gosford and Lithgow were the most severely affected. Given that the event occurred during the Christmas holidays, many residents and businesses have not fully assessed the extent of damages; therefore, loss estimates are expected to increase in the next few weeks.

Read the article >>

Cost of Capital and its Use in Valuing Reinsurance: Increasingly, reinsurance is seen as an important element of capital management. Reinsurance decisions are moving away from the reinsurance buyer and towards the finance teams. These teams need to find a way of comparing reinsurance in a straightforward way. Defining the cost of capital for reinsurance means that it can be compared with other capital sources.

Read the article>>

Marsh & McLennan Companies Climate Resilience Microsite: Extreme weather events, shifting regulations, evolving competition and increased actions by investors are just some of the challenges facing organizations - all driven by a growing focus on climate change.

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Catastrophe Insurance Gap in China: Even though China is the fastest growing insurance market in the world, the country’s catastrophe insurance protection gap remains significant, according to the recent report 14 Shades of Risk in Asia-Pacific: Evolving Risk Concerns by Marsh & McLennan Companies’ Asia-Pacific Risk Center.

Read the article >>

Cyberattacks Top Risk to Doing Business in India: A growing dependency on data and digitization efforts have increased the risks of cyberattacks in India, says the report 14 Shades of Risk In Asia-Pacific: Evolving Risk Concerns in Asia-Pacific by Marsh & McLennan Companies’ Asia-Pacific Risk Center.

Read the article >>

And, you may have missed …

GC Capital Ideas: CAT-i Stories: Fourth Quarter 2018: Here is a look back at the CAT-i articles from October 1 through December.

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December 28th, 2018

Week’s Top Stories: December 22 - 28, 2018

Posted at 10:00 AM ET

Affirmative versus Silent Cyber: An Overview: While the current debate over “affirmative” versus “non-affirmative” coverage has been ongoing for a few years, WannaCry and Petya/NotPetya cyberattacks helped make the issue of ”silent cyber” more critical. These two 2017 cyberattacks effectively shifted the conversation from data breach, notification costs and third-party liability to first-party liability insuring agreements due to the extent and expanse of the systematic, large-scale damages they triggered.

Read the article >>

Report: New Zealand’s Agriculture Lacking Risk Mitigation Measures: New Zealand’s vulnerability to climate-related risks such as extreme weather events is rising due to rapid urbanization and an increase in the frequency and severity of these events, according to the recent report 14 Shades of Risk In Asia-Pacific: Evolving Risk Concerns in Asia-Pacific by Marsh & McLennan Companies’ Asia-Pacific Risk Center.

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GC Capital Ideas: CAT-i Stories: Fourth Quarter 2018: Here is a look back at the CAT-i articles from October 1 through December.

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The Dangers Lurking in the Union between Construction and Emerging Tech: Technology startups geared toward the construction industry are booming. Contractors are adopting wearable tech to prevent and mitigate worker injuries and using 3D printing technologies for building components. The industry has seen a proliferation of building information modeling to foster digital collaboration between architects, engineers and contractors.

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Cost of Capital and its Use in Valuing Reinsurance: Increasingly, reinsurance is seen as an important element of capital management. Reinsurance decisions are moving away from the reinsurance buyer and towards the finance teams. These teams need to find a way of comparing reinsurance in a straightforward way. Defining the cost of capital for reinsurance means that it can be compared with other capital sources.

Read the article>>

And, you may have missed …

Global Insurance Prices Rise for Fourth Consecutive Quarter: Trends in property and financial and professional lines of coverage drove average commercial insurance prices higher for the fourth consecutive quarter, according to the most recent Marsh Global Insurance Market Index. Global commercial insurance prices tracked in the index rose, on average, more than one percentage point in the third quarter of 2018.

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December 21st, 2018

Week’s Top Stories: December 15 - 21, 2018

Posted at 10:00 AM ET

Global Insurance Prices Rise for Fourth Consecutive Quarter: Trends in property and financial and professional lines of coverage drove average commercial insurance prices higher for the fourth consecutive quarter, according to the most recent Marsh Global Insurance Market Index. Global commercial insurance prices tracked in the index rose, on average, more than one percentage point in the third quarter of 2018.

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Europe Experienced Increased Cyberattacks in the First Half of 2018: Estimates suggest that the number of cyberattacks across Europe increased by around a third in the first quarter of 2018, compared to the same period last year, according to the recent World Economic Forum (WEF) report Regional Risks for Doing Business 2018.

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Ensuring innovation is more than a cliché: The numerous challenges the insurance industry faces mean that innovation is critical to tackling them. Rob Bentley, Chief Executive Officer of Guy Carpenter’s Global Strategic Advisory, describes how Guy Carpenter is helping its clients manage these challenges-especially the conundrum of InsurTech, in an interview that appeared in Intelligent Insurer magazine.

Read the article >>

Affirmative versus Silent Cyber: An Overview: While the current debate over “affirmative” versus “non-affirmative” coverage has been ongoing for a few years, WannaCry and Petya/NotPetya cyberattacks helped make the issue of ”silent cyber” more critical. These two 2017 cyberattacks effectively shifted the conversation from data breach, notification costs and third-party liability to first-party liability insuring agreements due to the extent and expanse of the systematic, large-scale damages they triggered.

Read the article >>

Cost of Capital and its Use in Valuing Reinsurance: Increasingly, reinsurance is seen as an important element of capital management. Reinsurance decisions are moving away from the reinsurance buyer and towards the finance teams. These teams need to find a way of comparing reinsurance in a straightforward way. Defining the cost of capital for reinsurance means that it can be compared with other capital sources.

Read the article>>

And, you may have missed …

Report: New Zealand’s Agriculture Lacking Risk Mitigation Measures: New Zealand’s vulnerability to climate-related risks such as extreme weather events is rising due to rapid urbanization and an increase in the frequency and severity of these events, according to the recent report 14 Shades of Risk In Asia-Pacific: Evolving Risk Concerns in Asia-Pacific by Marsh & McLennan Companies’ Asia-Pacific Risk Center.

Read the article >>

Click here to register to receive e-mail updates >>

December 14th, 2018

Week’s Top Stories: December 8 - 14, 2018

Posted at 10:00 AM ET

Cost of Capital and its Use in Valuing Reinsurance: Increasingly, reinsurance is seen as an important element of capital management. Reinsurance decisions are moving away from the reinsurance buyer and towards the finance teams. These teams need to find a way of comparing reinsurance in a straightforward way. Defining the cost of capital for reinsurance means that it can be compared with other capital sources.

Read the article >>


Cyberattacks Emerge as Leading Risk in East Asia and the Pacific: Cyberattacks are the leading risk to doing business across East Asia and the Pacific, according to the recent World Economic Forum (WEF) report Regional Risks for Doing Business 2018.

Read the article >>


Europe Experienced Increased Cyberattacks in the First Half of 2018: Estimates suggest that the number of cyberattacks across Europe increased by around a third in the first quarter of 2018, compared to the same period last year, according to the recent World Economic Forum (WEF) report Regional Risks for Doing Business 2018.

Read the article >>


Here’s How to Bring Agility into the Boardroom: Today’s corporate world is being shaped by a near constant onslaught of unpredictable events. In such turbulent times the traditional corporate governance model risks becoming outdated and ineffective.

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14 Shades of Risks: Navigating the Risk Landscape in Asia-Pacific: The Asia-Pacific region (APAC) has become the world’s primary driver of global economic growth. While often referred to as one economic bloc, the Asia-Pacific region is home to countries and territories that are vastly different from each other in terms of demographics, economic development stages, political institutions and cultures. This regional heterogeneity translates to a diversified set of risk concerns in different countries and territories.

Read the article >>


And, you may have missed …

Ensuring Innovation Is More Than a Cliché: The numerous challenges the insurance industry faces mean that innovation is critical to tackling them. Rob Bentley, Chief Executive Officer of Guy Carpenter’s Global Strategic Advisory, describes how Guy Carpenter is helping its clients manage these challenges-especially the conundrum of InsurTech, in an interview that appeared in Intelligent Insurer magazine.

Read the article >>


Click here to register to receive e-mail updates >>

December 7th, 2018

Week’s Top Stories: December 1 - 7, 2018

Posted at 10:00 AM ET

Wildfire Activity - California - Update: Recent wildfire activity has rendered especially severe impacts to areas of California, including areas of Butte, Los Angeles and Ventura Counties. Rates of extreme fire spread were enabled by especially dry, windy conditions on November 8 and the days following. Aggressive firefighting efforts allowed containment efforts to progress despite adverse conditions over the following week.

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Mw 7.0 Earthquake – Near Anchorage, Alaska: A magnitude (Mw) 7.0 earthquake was reported near Anchorage, Alaska around 17:29 UTC on November 30 (8:29 local time), according to the U.S. Geological Survey (USGS). The epicenter was located at a depth of 44.1 km and about 12.9 km (8.0 miles) north of Anchorage, Alaska. A tsunami warning was issued but later lifted by the U.S. National Weather Service.

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Asia Pacific Reinsurance Market: Abundant Capacity and Flat Pricing: For buyers of catastrophe reinsurance in the Asia Pacific region, pricing has remained largely flat during 2018. The region has experienced losses during the year to date, and at the time of writing, it is expected that a proportion of these will impact reinsurers. At the same time, market capacity remains abundant and underlying reinsurance market conditions are favorable for buyers, as reported by Guy Carpenter in its 2018 Asia Pacific Catastrophe Reinsurance Executive Summary. The effect of the 2018 losses on market sentiment going forward is not fully understood.

Read the article >>


A Math Formula May Offer a Solution to Insurers’ Critical Challenges: Guy Carpenter has developed a methodology that applies a mathematical formula to provide insurers and reinsurers with a unified, practical framework for risk pricing and capital allocation.

Read the article >>


Ensuring innovation is more than a cliché: The numerous challenges the insurance industry faces mean that innovation is critical to tackling them. Rob Bentley, Chief Executive Officer of Guy Carpenter’s Global Strategic Advisory, describes how Guy Carpenter is helping its clients manage these challenges-especially the conundrum of InsurTech, in an interview that appeared in Intelligent Insurer magazine.

Read the article >>


And, you may have missed …

Cyberattacks Top the List of Risks in North America: For business executives in the United States and Canada, cyberattacks are now the number one risk to doing business, according to the recent World Economic Forum (WEF) report Regional Risks for Doing Business 2018.

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Click here to register to receive e-mail updates >>

November 30th, 2018

Week’s Top Stories: November 24 - 30, 2018

Posted at 10:00 AM ET

Cyberattacks Top the List of Risks in North America: For business executives in the United States and Canada, cyberattacks are now the number one risk to doing business, according to the recent World Economic Forum (WEF) report Regional Risks for Doing Business 2018.

Read the article >>

Terrorism: The Need for Expanded Capacity: Terrorists are increasingly able to modify, adapt and reinvent their tactics and quickly spread their methodologies to their worldwide support base. Economically, the effect of this change across the globe has been significant. Tourism, trade and investments are examples of areas affected as countries grapple with terrorist actions, both direct and indirect. According to the Institute for Economics and Peace, although the peak of global economic impact from terror events was reached in 2014, it remains at historically high levels.

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Affirmative versus Silent Cyber: An Overview: While the current debate over “affirmative” versus “non-affirmative” coverage has been ongoing for a few years, WannaCry and Petya/NotPetya cyberattacks helped make the issue of ”silent cyber” more critical. These two 2017 cyberattacks effectively shifted the conversation from data breach, notification costs and third-party liability to first-party liability insuring agreements due to the extent and expanse of the systematic, large-scale damages they triggered.

Read the article >>

Terrorism: Reinsurance Role in Mitigating the Expanding Peril: More than ever before, brokers and underwriters must use their expertise and solutions to keep insurers and citizens adequately protected. With the peril mutating rapidly, the entire insurance value chain is being challenged – by new types of threats, new modes of attack and the terrorists’ deployment of any violent and disruptive means to reach their desired end-state. The (re)insurance industry must remain in tune with these developments; it must gain insights from academia and observers on how the peril is changing, keep alert to new products in the market, unlock new sources of capacity and help clients understand their portfolios more readily so they remain relevant to their consumer base.

Read the article >>


A Math Formula May Offer a Solution to Insurers’ Critical Challenges: Guy Carpenter has developed a methodology that applies a mathematical formula to provide insurers and reinsurers with a unified, practical framework for risk pricing and capital allocation.

Read the article >>


And, you may have missed …

Risks from Infrastructure Shortfalls in Asia Pacific: In the Asia Pacific region, it is important to address the risk of critical infrastructure failure or shortfall, as analyzed by the latest annual report by Marsh & McLennan Companies’ Asia-Pacific Risk Center titled “From Threats to Impact - Evolving Risk Concerns in Asia-Pacific.”

Read the article >>


November 23rd, 2018

Week’s Top Stories: November 17 - 23, 2018

Posted at 10:00 AM ET

Affirmative versus Silent Cyber: An Overview: While the current debate over “affirmative” versus “non-affirmative” coverage has been ongoing for a few years, WannaCry and Petya/NotPetya cyberattacks helped make the issue of “silent cyber” more critical. These two 2017 cyberattacks effectively shifted the conversation from data breach, notification costs and third-party liability to first-party liability insuring agreements due to the extent and expanse of the systematic, large-scale damages they triggered.

Read the article >>


Regional Risks for Doing Business: The recent World Economic Forum’s 2018 Executive Opinion Survey provides a snapshot of the global risks that executives say are of highest concern for doing business in their respective countries. High unemployment remains the top risk concern for business leaders worldwide for the third year in a row, while concerns over large cyberattacks and national governance failure continue to rise.

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A Math Formula May Offer a Solution to Insurers’ Critical Challenges: Guy Carpenter has developed a methodology that applies a mathematical formula to provide insurers and reinsurers with a unified, practical framework for risk pricing and capital allocation.

Read the article >>


GC Videocast - Emerging Cyber Risks Explained: The “years of data breaches,” 2013 and 2014, evolved to healthcare breaches, followed by ransomware attacks. What cyber perils lie ahead? Guy Carpenter’s Jeremy S. Platt, Managing Director and Cyber Solutions Specialty Practice Leader; and Chris Shafer, Assistant Vice President at Cyber Solutions Specialty Practice, explain in the video.

View the video >>


2018 Asia Pacific Catastrophe Reinsurance Report: Guy Carpenter has released its 2018 Asia Pacific Catastrophe Reinsurance Report. The report reviews property catastrophe cover trends; market conditions, including losses and pricing; and catastrophe events in each of the major Asia Pacific countries during 2018. The Executive Summary of the report highlights key findings, including discussion of the various catastrophe events that have impacted the Asia Pacific region during 2018, such as Typhoon Jebi, the strongest typhoon to hit Japan in 25 years; and the Kerala Floods, the most severe to hit the southwestern Indian state since 1924.

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And, you may have missed …

Silent Cyber Explained: “Silent cyber,” also known as unintended or non-affirmative coverage, refers to the unknown or unquantified exposures stemming from cyber perils that may be triggered within traditional property and liability insurance policies. The systemic nature of the cyber risk means silent cyber may become increasingly more prevalent in virtually every type of insurance policy.

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