Posts Tagged ‘Month in Review’



April 3rd, 2018

GC Capital Ideas: Top Stories, March 2018

Posted at 1:00 AM ET

1. Chart: Global Property Catastrophe ROL index; The Guy Carpenter Global Property Catastrophe Rate on Line (ROL) index presented for 1990 through 2018.

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2. Chart: Catastrophe Bond Issuance and Capital Outstanding; Chart shows 144A P&C catastrophe issuance and capital outstanding for the years 1998 through year-end 2017 based on data from GC Securities’* proprietary database.

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3. Chart: The Matrix of Cyber and Property Lines Insurance Coverage; Chart examines the policy coverage matrix between cyber and property lines of insurance coverage.

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4. Automobile Liability Market Update & Loss Trends Analysis; For most U.S. property and casualty insurance companies, automobile liability line performance has typically been one of the major factors adversely impacting overall profitability in recent years.

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5. Guy Carpenter Reports Capital Growth and Market Resilience Despite 2017 Losses; Guy Carpenter has released an estimate of year-end reinsurance capital levels and results of the January 2018 reinsurance renewal.

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6. Takaful and the Opportunity for Peer-to-Peer Insurance; There has been much talk about peer-to-peer (P2P) insurance, and a number of startups in this space are emerging globally and in Asia.

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7. Cyber Risk in an Interconnected World; In a digital world, cyber exposure evolves every day, making it one of the most dynamic emerging risks in the industry. Just as the housing boom along the US shoreline accelerated property losses, the technological sophistication and digital connectivity of the global economy have increased the cyber threat for all sectors.

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8. Reinsurance Market Assessment: What the Numbers Reveal about the Current Industry Status; After several years of light catastrophe activity, particularly in the United States where capital deployment covering catastrophe exposures was heavily impacted by convergence capital, the events of 2017 provided a framework to evaluate how evolving market dynamics over the last few years held up to the real test of losses.

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9. Exposure to New Risks; Some emerging technologies are exposing organizations to new risks, but few practitioners report a significant impact. Over half of survey respondents report that artificial intelligence is impacting risk exposure at their organizations, although only 14 percent indicate the effect is significant.

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10.Formal Risk Appetite Missing; A formal risk appetite statement is missing at a majority of companies, although that could be changing.

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*Securities or investments, as applicable, are offered in the United States through GC Securities, a division of MMC Securities LLC, 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 LLC, 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.

March 5th, 2018

GC Capital Ideas Top Stories: February, 2018

Posted at 1:00 AM ET

1.Chart: Global Property Catastrophe ROL Index; The Guy Carpenter Global Property Catastrophe Rate on Line (ROL) index is presented for 1990 through 2018.

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2. Chart: Top Ten Significant Insured Loss Events: 2017; The table lists estimates for the top ten significant insured loss events for 2017.

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3. Guy Carpenter Reports Capital Growth and Market Resilience Despite 2017 Losses; Guy Carpenter has released an estimate of year-end reinsurance capital levels and results of the January 2018 reinsurance renewal.

Read the article >>


4. New Vehicle Matches the Right Capital to Risk; A new Marsh & McLennan vehicle provides unparalleled support in accessing long-term capital markets-based protection.

Read the article >>


5. From Risk to Resilience: Marsh & McLennan Companies Cyber Handbook 2018: Perspectives on the Next Wave of Cyber; Cyber risk continues to grow as technology innovation increases and societal dependence on information technology expands.

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6. Exploring the Excess & Surplus Industry: E&S Market Update and Projections; The excess and surplus (E&S) lines segment of the insurance industry continues to be the essential market for risks for which  the standard insurance market typically does not offer coverage.

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7. Association of Financial Professionals/Marsh & McLennan Risk Survey Report: 2018; Finance and treasury professionals are looking to adopt technologies such as artificial intelligence, blockchain and robotic process automation, but few are prepared for the new business risks that may be associated with these technologies - especially cyber, business operations and regulatory risks.

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8. Guy Carpenter Global Reinsurance Composite: Third Quarter 2017; Here we bring together recent Chart Room posts highlighting performance of the Guy Carpenter Global Reinsurance Composite.

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9. Cyber Risk: The Stakes Have Changed for the C-Suite; Three major cyber events in 2017 set new precedents for the scope of damage wrought by cyber-attacks.

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10. Marsh & McLennan Companies Climate Resilience Handbook, 2018; Marsh & McLennan Companies has developed a comprehensive framework to help organizations think through all aspects of climate resilience.

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February 5th, 2018

GC Capital Ideas Top Stories: January, 2018

Posted at 2:00 AM ET

1 .Guy Carpenter Reports Capital Growth and Market Resilience Despite 2017 Losses; Guy Carpenter has released an estimate of year-end reinsurance capital levels and results of the January 2018 reinsurance renewal.

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2. Chart: Return on Equity for Guy Carpenter Reinsurance Composite, Q3, 2017; Chart presents return on equity for the Guy Carpenter Global Reinsurance Composite, 2005 through third quarter, 2017.

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3. Guy Carpenter Reports US Insurance Market at a Crossroads but Opportunity Exists; Guy Carpenter today released a study outlining a dynamic insurance industry facing a changing economy and pressure in once-stable lines, but with opportunity for those with management skill and understanding of risk.

Read the article >>


4. Threat Trends on Major Cyber Attacks in 2017; The Marsh & McLennan Companies Cyber Risk Handbook 2018 is published.

Read the article >>


5. Exploring the Excess & Surplus Industry: E&S Market Update and Projections; The excess and surplus (E&S) lines segment of the insurance industry continues to be the essential market for risks for which  the standard insurance market typically does not offer coverage.

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6. 2017 North Atlantic Hurricane Season; The 2017 North Atlantic Hurricane season was one of the most active seasons on record, a historic season in many respects, and certainly an impactful one. Those most severely affected residents are facing a long and difficult recovery that could last for years. They continue to have our thoughts and concerns.

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7. Guy Carpenter Reports Moderating Reinsurance Pricing Decline at January 1, 2017 Renewals; Guy Carpenter & Company reports the decline in reinsurance pricing moderated at the January 1, 2017 renewal across most classes of business and geographies, as compared to the past three renewal seasons.

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8. The Impact of Insurtech; Here we review recent GC Capital Ideas posts on the growing interest in insurtech and its impact on the insurance industry.

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9. Industry Must Develop Common Cyber Risk Currency; Diversification is essential for evolving the cyber insurance market, yet expanding the cyber remit beyond data confidentiality and further into areas such as operational technology risk, data availability and integrity demands a common cyber risk currency, according to Morley Speed, Managing Director, and Carolyn Morley, Chairman, Global Casualty, Guy Carpenter.

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10. Guy Carpenter Global Reinsurance Composite: Third Quarter 2017: Here we bring together recent Chart Room posts highlighting performance of the Guy Carpenter Global Reinsurance Composite.

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January 2nd, 2018

GC Capital Ideas Top Stories: December, 2017

Posted at 1:00 AM ET

1. Flood Insurance: The 2018 Market Opportunity; The U.S. insurance industry is actively seeking new opportunities for growth in a challenging market by identifying untapped customer needs. The potential flood market is over five times the size of the most often mentioned new market, cyber insurance.

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2. Asia Pacific Catastrophe Report 2017: Executive Summary; A year marked by generally benign loss experience and few large catastrophe events meant that rates continued to remain positive for buyers in the Asia Pacific region throughout 2017. At the same time, the trend for steady growth in limit purchased continued.

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3. Run-off specialists are gearing up for increased flows; Transaction volumes in the run-off market will continue to grow as a consequence of an influx of capital and increased amounts of buyers and sellers of legacy reserves, according to Andrew Beecroft, Head of M&A Advisory, GC Securities*.

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4. Exploring the P&C Industry: Recent Market Dynamics and Industry Performance; The property and casualty (P&C) insurance industry continues to face economic and market-based challenges. New risks demand coverage; catastrophes are surfacing in unexpected ways and experience shifts are driving casualty lines’ capital needs.

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5. Addressing Flood Peril; Here we review recent GC Capital Ideas posts on Guy Carpenter’s efforts to address the flood peril.

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6. Little-Used Retirement Option Gets a Big Boost; With the erosion of defined benefit pension plans and uncertainty around the future of Social Security, the current workforce must find new ways to responsibly manage their income into and through retirement.

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7. Critical Tool for Making Strategic Enterprise Risk Management Decisions; There are indications that new A.M. Best Stochastic Based BCAR factor assignments may require more capital for companies entering a new line of business than for established writers growing in that line.

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8. Increasing External Demands Compel Companies to Improve Risk Management Disclosures; Guy Carpenter released an Enterprise Risk Management (ERM) Benchmark Review in 2014 providing an in-depth analysis of risk management practices and policies of 67 insurance and reinsurance companies located in Europe, United States, Bermuda, and Asia-Pacific. Based on publicly-available data from financial and risk reports, Guy Carpenter’s ERM Benchmark Review reveals that most (re)insurers are managing capital with metric-based frameworks and are publishing more about their risk management targets than seen in Guy Carpenter’s 2009 analysis.

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9. Managing Catastrophe Model Uncertainty, Issues and Challenges; Here we repeat our popular series authored by John Major, which focuses on the issues and challenges in managing catastrophe model uncertainty.

Read the article>>


10. Reinsurance Solutions Continue to Achieve Stability and Growth for Cedents; Since its beginnings, the reinsurance product has been a tool that delivers diversified balance sheet solutions to insurers to help protect capital, manage earnings, reduce volatility and promote profitable growth, according to James Nash, President, International, Guy Carpenter.

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*Securities or investments, as applicable, are offered in the United States through GC Securities, a division of MMC Securities LLC, 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 LLC, 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.

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December 4th, 2017

GC Capital Ideas Top Stories: November, 2017

Posted at 1:00 AM ET

1. Just Say “Know” to Insurtech; Insurtech’s impact on the insurance industry is surging, reminding us of the influence that technological change and growth bring to the modern consumer and business landscapes and individual industries  -  the development of fintech within financial services being an example.

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2. Guy Carpenter Reports US Insurance Market at a Crossroads but Opportunity Exists; Guy Carpenter today released a study outlining a dynamic insurance industry facing a changing economy and pressure in once-stable lines, but with opportunity for those with management skill and understanding of risk.

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3. From Risk to Resilience: Marsh & McLennan Companies Cyber Handbook 2018: Perspectives on the Next Wave of Cyber; Cyber risk continues to grow as technology innovation increases and societal dependence on information technology expands. A new and important turning point has been reached in the struggle to manage this complex risk. In the war between cyber attackers and cyber defenders, we have reached what Winston Churchill might call “the end of the beginning.”

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4. Understanding Systemic Cyber Risk; Insights Through Pandemic Behavior; Today, through air travel, a carrier of MERS or Ebola can cross the ocean in less than a day, board a crowded subway train and potentially infect hundreds of people. Containment of a pandemic outbreak begins upon discovery, similar to the way in which forensics and network restoration efforts can begin once a cyber breach is identified. According to Platt, the longer the lag until discovery, the more difficult containment and treatment will be, whether it is a biological or cyber event.

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5. Asia Pacific Catastrophe Report 2017: Executive Summary: Losses; Insured losses in Australia and New Zealand were the largest events. The region was also impacted by floods in China, India and Thailand and an earthquake in China. Once again, flood was a major contributor to economic losses in the region, but often in areas where insurance penetration was limited. Flood is difficult for (re)insurers to model, but Guy Carpenter has made significant steps to help clients deal with the problems.

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6. Insurers Challenged by Forces of Technology Disruption; Here we review recent GC Capital Ideas posts on the need for the insurance industry to come to terms with the forces of technological disruption challenging their business models.

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7. Threat Trends on Major Cyber Attacks in 2017; The Marsh & McLennan Companies Cyber Risk Handbook 2018 is published.

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8. Study Identifies Winners in Growing Insurtech Space; A 2017 report from consulting firm Oliver Wyman and insurtech investor Policen Direkt analyzes insurtech business models worldwide and pinpoints winners and losers.

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9. Insurers Adapting in a Time of Disruption; Here we review recent GC Capital Ideas posts on strategies insurers may utilize to continue to achieve growth in a disruptive environment.

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10. For MPL, Market Softening Continues in 2016-Signs of Pressure Emerge; Since 2010, the medical professional liability (MPL) industry has been navigating a soft market, with declining profitability, diminished investment gains and rising accident year operating ratios. Yet, reserve redundancies have kept calendar year combined ratios below 100 percent, allowing carriers to pay dividends to policyholders while maintaining favorable returns on equity.

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November 6th, 2017

GC Capital Ideas Top Stories: October, 2017

Posted at 4:00 AM ET

1. Reinsurance Market Poised to Remain Vibrant Following Recent Catastrophe Events: The recent series of catastrophic events - earthquakes in Mexico, Hurricanes Harvey, Irma and Maria - is reminding cedents that reinsurance is one of the most effective ways to protect corporate capital bases; Harvey on its own is likely to be an earnings event that will probably not require an increase of industry capital; the addition of the cumulative effect of the earthquakes in Mexico and Hurricanes Irma and Maria, however, could create a capital event;  and the earthquakes and hurricanes provide an opportunity to define the viability and effectiveness of the 144A product. We expect that these instruments will demonstrate their effectiveness and serve their intended purpose.

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2. Flood Insurance: The 2018 Market Opportunity: The U.S. insurance industry is actively seeking new opportunities for growth in a challenging market by identifying untapped customer needs. The potential flood market is over five times the size of the most often mentioned new market, cyber insurance; greater access to flood data and loss results and more reliable exposure modeling are enhancing the flood (re)insurance marketplace; and several developments are helping carriers understand and monitor aggregation.

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3. Industry Must Act to Avoid a “Kodak Moment”: In his first speech as Lloyd’s new chairman, Bruce Carnegie-Brown said the insurance industry must do more to change and innovate or run the risk of being disrupted by external players.

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4. Guy Carpenter Reports US Insurance Market at a Crossroads but Opportunity Exists: Guy Carpenter released a study outlining a dynamic insurance industry facing a changing economy and pressure in once-stable lines, but with opportunity for those with management skill and understanding of risk.

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5. California Wildfires - October 8-17, 2017: Wildfire activity has rendered especially severe impacts to certain areas of California since October 8, including areas of Napa, Sonoma and Solano Counties. Wildfire activity has also rendered impacts to areas of Orange County east of the Los Angeles Metro area. Rates of extreme fire spread were enabled by especially dry conditions together with offshore gusty winds to burn a total of at least 217,566 acres since October 8. Media reports indicate at least 41 fatalities, making this the deadliest series of fires in California history. At least 5,700 structures have been destroyed and thousands more remain under threat. Containment efforts have made significant progress in the last week, thanks to efforts of at least 10,000 firefighters and reduced winds.

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6. Baden-Baden Reinsurance Symposium Addresses Industry-wide Impact of Disruption: Guy Carpenter & Company hosted the Reinsurance Symposium in Baden-Baden on October 22. The ninth year that Guy Carpenter has hosted the event, the theme of the Symposium was “Profiting from Disruption.”

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7. Chart: Combined Ratio for Guy Carpenter Reinsurance Composite, First Half, 2017: Chart presents combined ratio for the Guy Carpenter Global Reinsurance Composite, 2006 through first half, 2017.

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8. Just Say “Know” to Insurtech: As insurtech offerings proliferate, to gain the advantages promised, companies need to know the opportunities afforded; know their own strengths and capabilities for engagement; and know their clients’ needs and expectations; insurtech is the evolutionary next step for insurance through the combination of data, analytics and technology in new and innovative ways; and capturing information in real time through sensors or mobile devices is the newest process for the collection of data for analytics.

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9. Understanding Systemic Cyber Risk; Insights Through Pandemic Behavior: Today, through air travel, a carrier of MERS or Ebola can cross the ocean in less than a day, board a crowded subway train and potentially infect hundreds of people. Containment of a pandemic outbreak begins upon discovery, similar to the way in which forensics and network restoration efforts can begin once a cyber breach is identified. According to Platt, the longer the lag until discovery, the more difficult containment and treatment will be, whether it is a biological or cyber event.

Read the article>>


10. Guy Carpenter Appoints Claude Yoder to Lead Global Innovation and Product Development: Guy Carpenter & Company is pleased to announce the appointment of Claude Yoder as Managing Director and Global Chief Innovation and Product Development Officer.

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* Securities or investments, as applicable, are offered in the United States through GC Securities, a division of MMC Securities LLC, 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 LLC, 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.

October 2nd, 2017

GC Capital Ideas Top Stories: September, 2017

Posted at 4:00 AM ET

1. Hurricane Irma: Hurricane Irma was a large and destructive storm that rendered impacts to most of the Southeast United States including the Florida Keys as well as areas of the Caribbean. Impacts for areas of the Northern Leeward Islands and the Virgin Islands, as well as northern Cuba have been especially severe. For the United States, the most severe impacts have been in the Florida Keys due to both wind and storm surge, with flood impacts as far away as coastal Georgia and northeast Florida. Wind impacts extend from Tennessee to the Carolinas to Florida. At least 67 fatalities have been reported.

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2. Hurricane Harvey: Following initial landfall, Hurricane Harvey continued to meander over southeast Texas while weakening to tropical storm status due to land interaction. Harvey then briefly emerged over the Gulf of Mexico before turning to the northeast and making a third landfall near Cameron, Louisiana, early Wednesday morning as a tropical storm. Harvey has since continued to move to the north-northeast and weakened further due to land interaction and dry air. The National Hurricane Center (NHC) downgraded Harvey from tropical storm to tropical depression status at 8 p.m. EDT on August 30, and discontinued tropical storm warnings at that time.

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3. Chart: Return On Equity for Guy Carpenter Reinsurance Composite, First Half, 2017: Chart presents return on equity for the Guy Carpenter Global Reinsurance Composite, 2006 through first half, 2017.

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4. New Vehicle Matches the Right Capital to Risk: A new Marsh & McLennan vehicle provides unparalleled support in accessing long-term capital markets-based protection; a broader and more diverse range of capital sources brings better matching, more efficient solutions customized to the unique risk profile of clients; and the vehicle provides a standardized documentation process and single point of access, in an efficient and cost-effective manner.

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5. Excess Capacity in This Year’s Florida Market: The Florida peninsula is the most important market for property reinsurance in the world. Each summer, the third most populous state in the union braces itself for another Atlantic hurricane season. In Florida’s esoteric insurance market, insurers buy reinsurance protection at the beginning of June each year.

Read the article>>


6. Public Sector Risk Financing Perspectives in the United States: The Market for Mortgage Credit Risk (Re)insurance: The global financial crisis of 2008 exposed the U.S. mortgage industry, taxpayers, and the global capital markets to the loss potential of residential mortgage credit risk.

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7. Chart: Source Of Earnings for Guy Carpenter Reinsurance Composite, First Half, 2017: Chart presents source of earnings for the Guy Carpenter Global Reinsurance Composite for first half 2017 compared to first half 2016.

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8. Industry Must Develop Common Cyber Risk Currency: Data integrity and availability is as critical as data confidentiality; limited ability to quantify dependency is a major cyber inhibitor; and the challenge is to build a clearly differentiated cyber portfolio.

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9. GC Securities and Marsh Captive Solutions Introduce Cerulean Re: GC Securities, a division of MMC Securities LLC, a U.S. registered broker-dealer and member FINRA/NFA/SIPC, announced the establishment of Cerulean Re SAC Ltd. (Cerulean), a private syndicated collateralized reinsurance platform and Bermuda registered segregated account company (SAC) and licensed special purpose insurer.

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10. Run-off Specialists Are Gearing Up For Increased Flows: Challenging markets and active capital management are encouraging carriers to proactively consider reserve solutions; a competitive market for acquisition of run-off assets has broadened; and new entrants are forming in anticipation of increased flows of legacy business.

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* Securities or investments, as applicable, are offered in the United States through GC Securities, a division of MMC Securities LLC, 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 LLC, 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.

September 5th, 2017

GC Capital Ideas Top Stories: August, 2017

Posted at 1:00 AM ET

1. Hurricane Harvey: Following initial landfall, Hurricane Harvey continued to meander over southeast Texas while weakening to tropical storm status due to land interaction. Harvey then briefly emerged over the Gulf of Mexico before turning to the northeast and making a third landfall near Cameron, Louisiana, early Wednesday morning as a tropical storm. Harvey has since continued to move to the north-northeast and weakened further due to land interaction and dry air. The National Hurricane Center (NHC) downgraded Harvey from tropical storm to tropical depression status at 8 p.m. EDT on August 30, and discontinued tropical storm warnings at that time.

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2. The Insurance of Things & Industry 4.0 - A Matrix View: Technological progress and the accumulation of assets have not only stimulated the development of insurance products; they have in turn been nurtured by the availability of these offerings.

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3. Cat Modelling Challenges in Europe: 2016 marked the 60th year of the Monte Carlo Rendez-Vous. Since the first event in 1957 the insurance world has changed significantly, with economic and insured losses from natural catastrophes such as floods and hurricanes increasing dramatically.

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4. Factors Contributing to the Gap Between Economic and Insured Losses: The factors that contribute to the gap between economic and insured losses.

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5. Insurtech in China: Revolutionizing the Insurance Industry: China’s capital markets aren’t yet mature enough to support financial innovation; meanwhile, existing state-owned financial institutions are not reforming quickly enough. This gap in supply has provided opportunities for Chinese fintech players - who are being supported by rapidly growing online ecosystems and a tech-savvy population - in diverse fields ranging from investing to payments.

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6. Public Sector Risk Financing Perspectives in Europe/Middle East/Africa: On a global basis, approximately 70 percent of the economic loss caused by natural catastrophe events is not covered by insurance. This gap, the cost of uninsured events, frequently falls on governments through disaster relief, welfare payments and infrastructure repair and rebuilding. The ultimate cost of these responses causes a strain on public balance sheets and an increase in public debt, ultimately burdening taxpayers. The protection gap is increasing in emerging economies especially where the amount of natural catastrophe economic loss covered by insurance dropped from 25 percent in 2002 to approximately eight percent in 2014.

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7. GC Securities Completes First Listed P&C Cat Bond Issued by World Bank International Bank for Reconstruction & Development’s Capital-at-Risk Program: GC Securities, a division of MMC Securities LLC, a U.S. registered broker-dealer and member FINRA/NFA/SIPC, today announced the placement of a catastrophe bond benefitting the government of Mexico’s Fund for Natural Disasters (FONDEN). The $360,000,000, three-class catastrophe bond is issued by the International Bank for Reconstruction and Development (”World Bank” or “IBRD”), and represents the first listed property and catastrophe bond issued under its Capital-at-Risk notes program.

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8. Guy Carpenter Announces Senior Promotions in Asia Pacific: Guy Carpenter & Company today announced that Tony Gallagher has been appointed CEO of the Asia Pacific Region, with immediate effect. In addition, Richard Jones has been promoted to Chairman of the Region.

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9. China Risk Oriented Solvency System (C-ROSS): The China Insurance Regulatory Commission (CIRC) is instituting sweeping changes through its three-tiered China Risk Oriented Solvency System (C-ROSS) framework that will dramatically impact how (re)insurers conduct business. It will strengthen capital requirements, risk management and transparency disclosures - bringing China in line with, and in some cases overtaking, global standards. The C-ROSS framework is similar to Solvency II: three tiers focusing on quantitative, qualitative and disclosure requirements.

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10. Increasing External Demands Compel Companies to Improve Risk Management Disclosures: Guy Carpenter released its latest Enterprise Risk Management (ERM) Benchmark Review, providing an in-depth analysis of risk management practices and policies of 67 insurance and reinsurance companies located in Europe, United States, Bermuda, and Asia-Pacific. Based on publicly-available data from financial and risk reports, Guy Carpenter’s ERM Benchmark Review reveals that most (re)insurers are managing capital with metric-based frameworks and are publishing more about their risk management targets than seen in Guy Carpenter’s 2009 analysis.

Read the article>>


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* Securities or investments, as applicable, are offered in the United States through GC Securities, a division of MMC Securities LLC, 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 LLC, 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.

August 1st, 2017

GC Capital Ideas Top Stories: July, 2017

Posted at 1:00 AM ET

1. Excess Capacity in This Year’s Florida Market: The Florida peninsula is the most important market for property reinsurance in the world. Each summer, the third most populous state in the union braces itself for another Atlantic hurricane season. In Florida’s esoteric insurance market, insurers buy reinsurance protection at the beginning of June each year.

Read the article>>


2. Chart: Return On Equity For Guy Carpenter Reinsurance Composite, Q1 2017: Chart presents return on equity for the Guy Carpenter Global Reinsurance Composite, 2006 through first quarter, 2017.

Read the article>>


3. Chart: Combined Ratio For Guy Carpenter Reinsurance Composite, Q1 2017: Chart presents combined ratio for the Guy Carpenter Global Reinsurance Composite, 2006 through first quarter, 2017.

Read the article>>


4. Managing Catastrophe Model Uncertainty, Issues and Challenges: Here we repeat our series authored by John Major, which focuses on the issues and challenges in managing catastrophe model uncertainty.

Read the article>>


5. New Study Identifies Winners in Growing Insurtech Space: A new report from consulting firm Oliver Wyman and insurtech investor Policen Direkt analyzes insurtech business models worldwide and pinpoints winners and losers.

Read the article>>


6. Guy Carpenter Asia-Pacific Climate Impact Centre Publishes New Annual Report: The report, covering the Centre’s activities during 2016, is divided into five sections.

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7. Chart: The Matrix of Cyber and Property Lines Insurance Coverage: Chart examines the policy coverage matrix between cyber and property lines of insurance coverage. Below shows how the four types of subject matter (columns A-D) are generally covered by direct policies, relative to the various types of cyber and property perils (rows 1-5). Where cover is predominantly provided by property or cyber, the relevant icon is shown in blue. Where there is a degree of ambiguity, or coverage is limited, the icon is shown in gray.

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8. Public Sector Risk Financing Perspectives - Pandemic Risk: Public entities’ use of capital markets-based risk transfer capacity for the assumption of natural disaster losses, such as the cost of emergency relief and infrastructure and property damage has demonstrated success in de-risking public sector balance sheets. Capital markets innovators are beginning to leverage the outcomes achieved in the natural disaster sphere to other types of public sector severity losses, notably pandemic diseases. The capital markets may help fund resources to rapidly contain the spread of a pandemic, share the burden of associated medical expenses and/or manage the financial impact of the higher mortality rates.

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9. GC Securities* Completes First Ever Indemnity Triggered Multi-Europe Peril Only 144A Catastrophe Bond for Assicurazioni Generali S.p.A.: GC Securities, a division of MMC Securities LLC, a U.S. registered broker-dealer and member FINRA/NFA/SIPC, announced the placement of Principal At-Risk Variable Rate Notes, with notional principal at €200,000,000, through a newly formed special purpose vehicle domiciled in Ireland, Lion II Re DAC, to benefit Assicurazioni Generali S.p.A., an Italian insurance company and the parent company of the Generali Group. This is the third time that Assicurazioni Generali S.p.A. has utilized the insurance-linked securities market and is the first ever 144A cat bond to provide indemnity protection against multiple Europe perils.

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10. Disruptive Forces Redefining the Role of Insurance: Fundamental disruptive forces are driving monumental changes in the global economy at an unprecedented rate. These forces compel the (re)insurance industry to adjust to the new reality and capitalize on the opportunities created.

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*Securities or investments, as applicable, are offered in the United States through GC Securities, a division of MMC Securities LLC, 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 LLC, 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.