As third quarter results become available, Guy Carpenter will continue to update the Shareholders’ Funds Development chart. With the latest information, the analysis has not changed, indicating that the latest results are consistent with early insights.
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As third quarter results become available, Guy Carpenter will continue to update the Change in Equity chart. With the latest information, the analysis has not changed, indicating that the latest results are consistent with early insights.
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The Guy Carpenter Global Composite’s combined book value is down 18 percent from the beginning of the year, reflecting the continued pressure that carriers face as third quarter results are released. Meanwhile, the S&P 500 Banks Index has recovered slightly, with its year-to-date decline hitting 32 percent, compared to last week’s 37 percent.
As third quarter results become available, Guy Carpenter will continue to update the Post-Tax Hurricane Exposures chart. With the latest information, the analysis has not changed, indicating that the latest results are consistent with early insights.
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Unrealized losses, share repurchases, and dividends combined to drive aggregate shareholders’ funds for the Guy Carpenter Reinsurance Composite 16 percent lower for the year by September 30, 2008. Net income was modest, heavily impaired by realized losses.
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Compared to Bermudian carriers, European underwriting results were constrained in the first nine months of 2007. They made up difference with investment income and realized gains. When this source of earnings turned negative in 2008-falling from a gain of USD3.3 billion comprised of realized gains, to a loss of USD12.6 bilion-European P&Ls were affected profoundly.
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As publicly traded (re)insurers continue to report their third quarter results, the impact of the ongoing financial catastrophe is becoming more noticeable. All three indices lost value over the past week. The S&P 500 Insurance Index, S&P Banks Index, and Dow Jones Euro Stoxx Insurance Index all saw declines in their weighted average book values, according to data from Bloomberg.
Book Value Update: Earnings Announcement Impact: the erosion of balance sheets continues, as the effects of a global financial catastrophe spread across financial markets.
Get Credit for Your ECM with S&P: Standard & Poor’s (S&P) has released a new framework for determining whether a carrier’s own ECM can receive partial credit in the S&P capital adequacy evaluation.
Financial Catastrophes: No Storm, Plenty of Damage: throughout 2008, every major city in the world felt the reverberations of a “financial catastrophe,” triggered by the collapse of the subprime mortgage market.
Uncover and Mitigate Product Liability Risk: Avert a Casuaty Catastrophe: Casualty Cat, a new model developed jointly by Guy Carpenter and Arium, Ltd., seeks to identify the hidden product liability accumulations in a carrier’s portfolio and delivers the insights needed for informed action.
Defining the Value of Risk Management: the fundamental activity of risk-bearers has not been measurable, leaving a cloud of ambiguity in the middle of every carrier’s operation.
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Alternatives to Alternative Capital: (re)insurers have come to expect that alternative sources of capital will always be available, but the well may be at risk of running dry.
Only two companies, including the Lloyd’s of London market central assets, saw an increase in equity over the period. The simple average of changes reported to date is -10.1 percent.
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Andrew Marcell, CEO of Americas
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We live in a world at risk, but sometimes, the threats take new forms. Even as we are coming out of an above-average U.S. storm season, carriers are focused on a new type of disaster. Throughout 2008, every major city in the world felt the reverberations of a “financial catastrophe,” triggered by the collapse of the subprime mortgage market. This event has put severe pressure on both sides of the balance sheet and proved that an economic event can have the power to move the market.
