November 11th, 2014

Cyber-Related Risk to Critical Infrastructure

Posted at 1:00 AM ET

The table shows the sectors identified as critical by both the US government in the recent Presidential Policy Directive 21, and by the European Commission, as stated in the proposal, Directive on European Critical Infrastructure.

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November 10th, 2014

Regional Variations in Cyber Cover

Posted at 1:00 AM ET

Here we examine the variations in the regulation of data protection and privacy between the United States and Europe.

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November 7th, 2014

Week’s Top Stories: November 1 — 7, 2014

Posted at 8:00 AM ET

Demand for Asia Pacific Catastrophe Reinsurance Remains High in 2014: Guy Carpenter published a new report highlighting the continued increase in 2014 of total Asia Pacific catastrophe limit purchased. However, a confluence of factors, including the weakening of some key zone currencies has meant that reinsurance premium spend in the region has declined significantly.

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Chart: Global Property Catastrophe ROL Index: The Guy Carpenter Global Property Catastrophe Rate on Line index is presented for 1990 through 2014.  The index fell by 11 percent at January 1, 2014.

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Chart: Return On Equity For Guy Carpenter Reinsurance Composite, H1 2014: Chart presents return on equity for the Guy Carpenter Global Reinsurance Composite, 2004 through first half, 2014.

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Guy Carpenter and Oliver Wyman Publish Annual Insurance Risk Benchmarks Research: Guy Carpenter and Oliver Wyman, both wholly owned subsidiaries of Marsh & McLennan Companies, released the 2014 Insurance Risk Benchmarks Research: Annual Statistical Review, the first in a two-part series detailing research executed in collaboration with Columbia University. This, the fourth annual report, provides detailed analysis and insight on the property/casualty industry to help insurers strategically evaluate and benchmark inputs to economic capital models.

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Chart: Evolution of Shareholders’ Funds For Guy Carpenter Reinsurance Composite, H1 2014: Chart presents the evolution of shareholders’ funds for the Guy Carpenter Global Reinsurance Composite, 2012 through first half, 2014.

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And, You May Have Missed…

As Cyber-Attacks Escalate, So Does Demand for Cyber-Specific Insurance: From data breaches, to network business interruption to cyber extortion, the frequency and severity of cyber-attacks that have struck governments, utilities, individuals, medical and academic institutions and companies of all sizes are on the rise.

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November 6th, 2014

Chart: Combined Ratio for Guy Carpenter Composite, H1 2014

Posted at 1:00 AM ET

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

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November 5th, 2014

Chart: Return On Equity For Guy Carpenter Reinsurance Composite, H1 2014

Posted at 1:00 AM ET

Chart presents return on equity for the Guy Carpenter Global Reinsurance Composite, 2004 through first half, 2014.

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November 5th, 2014

Chart: Return on Revenue For Guy Carpenter Reinsurance Composite, H1 2014

Posted at 1:00 AM ET

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

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November 4th, 2014

Chart: Evolution of Shareholders’ Funds For Guy Carpenter Reinsurance Composite, H1 2014

Posted at 1:00 AM ET

Chart presents the evolution of shareholders’ funds for the Guy Carpenter Global Reinsurance Composite, 2012 through first half, 2014.

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November 4th, 2014

Chart: Source Of Earnings For Guy Carpenter Reinsurance Composite, H1 2014

Posted at 1:00 AM ET

Chart presents source of earnings for the Guy Carpenter Global Reinsurance Composite for the first half, 2014 compared to first half, 2013.

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November 3rd, 2014

GC Capital Ideas Top Stories: October, 2014

Posted at 1:00 AM ET

1. Chart: Global Property Catastrophe ROL Index: The Guy Carpenter Global Property Catastrophe Rate on Line index is presented for 1990 through 2014.  The index fell by 11 percent at January 1, 2014.

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2. Guy Carpenter Announces New Cyber Product Launch: Guy Carpenter today announced the launch of a new cyber privacy and network protection solution designed to meet the unique cyber challenges faced by small- and medium-sized companies.

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3. Guy Carpenter and Oliver Wyman Publish Annual Insurance Risk Benchmarks Research: Guy Carpenter and Oliver Wyman, both wholly owned subsidiaries of Marsh & McLennan Companies, released the 2014 Insurance Risk Benchmarks Research: Annual Statistical Review, the first in a two-part series detailing research executed in collaboration with Columbia University. This, the fourth annual report, provides detailed analysis and insight on the property/casualty industry to help insurers strategically evaluate and benchmark inputs to economic capital models.

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4. Understanding Emerging Risks: Executive Summary: (Re)insurers today face a degree of change and uncertainty that appears to be evolving at an ever quickening pace. Guy Carpenter has published a report, Ahead of the Curve: Understanding Emerging Risks, highlighting emerging risks facing the (re)insurance sector, including cyber-attacks, terrorism and new compensation structures for long-term bodily injuries. The report seeks to identify and categorize these risks that are now confronting the sector, as well as analyze their implications on businesses and (re)insurers.

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5. Chart: Catastrophe Bonds Versus Various Other Capital Market Assets Classes: Chart shows the cumulative return profile of 144A catastrophe bonds (as a proxy for all capital markets-based risk transfer capacity) versus various other capital market asset classes through mid-year 2014.

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6. Centralization of Reinsurance Buying: It should come as no surprise that there is a general trend among larger cedents to centralize reinsurance buying decisions and retentions and to bundle homogeneous products. This has become possible with the improvement of available portfolio data. This practice has some obvious advantages for buyers, such as reduced spend, reduced administration, improved control over counter-party credit risks and, possibly, retention of additional profits that would otherwise be ceded to reinsurers.

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7. Historical Development of Cyber (Re)Insurance: Companies are uncertain of how much coverage to acquire and whether their current policies provide them with protection. One of the roots of the uncertainty stems from the difficulty in quantifying potential losses because of the dearth of historical data for actuaries and underwriters to model cyber-related losses. Furthermore, traditional general liability policies do not always cover cyber risk. In the United States, ISO’s revisions to its general liability policy form consist primarily of a mandatory exclusion of coverage for personal and advertising injury claims arising from the access or disclosure of confidential information.

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8. A.M. Best’s New Analytics Will Broaden and Improve P&C Industry Capital Modeling and Benchmarking of Tolerances: A.M. Best’s rating analytics continue to evolve and the pace of change is accelerating as the industry embraces more analytical tools, emerging best practices, and peer benchmarking.

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9. Chart: Private Catastrophe Bonds Mid-Year 2014: Chart shows the evolution of private catastrophe bonds through mid-year 2014 based on deal count and total aggregate limit placed.

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10. Baden-Baden Reinsurance Symposium Assesses Future Impact of Current Market Conditions: Guy Carpenter hosted “The Reinsurance Industry of the Future,” the Reinsurance Symposium held in Baden-Baden, Germany on October 19. A distinguished line-up of industry luminaries expressed their views on whether the current changes impacting the reinsurance sector are permanent and structural in nature, are a tactical response to short-term conditions, or are part of the normal evolutionary process.

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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.

November 2nd, 2014

Demand for Asia Pacific Catastrophe Reinsurance Remains High in 2014

Posted at 3:30 PM ET

Guy Carpenter today published a new report highlighting the continued increase in 2014 of total Asia Pacific catastrophe limit purchased. However, a confluence of factors, including the weakening of some key zone currencies has meant that reinsurance premium spend in the region has declined significantly.

Continue reading…