Frank Achtert, Managing Director Contact The objective of Solvency II—expected to take effect in 2012—is simple. The regulation seeks to protect policyholders and the global insurance system through adequate, risk-based capital (RBC) requirements. Carriers will have to demonstrate a 99.5 percent likelihood of solvency for the coming 12 months, based on the risks they hold in the ... Continue Reading »
Property
World Catastrophe Reinsurance Market 2008
Catastrophe reinsurance rates declined for the second year in a row. Price competition intensified as a result of abundant capital, lower than average catastrophe losses, and strong overall profitability. But, reinsurance rates are projected to decrease at a slower pace in 2009 than in 2008, as reinsurers face earnings pressure from a number of sources. According to the Guy ... Continue Reading »
Looking at a Downturn?
Peter Zaffino, President & CEO Contact All eyes will be on January, 1 2009. As we approach the next renewal season, another round of rate decreases seems likely. The pace should be slower than it was through 2008, thanks to greater underwriter discipline than in previous downturns. Thus, even though the market has not been catastrophe-free, it has been able to absorb the ... Continue Reading »
Bag Profits Early: Investment Gains Under Pressure
Christopher Klein, Global Head of Business Intelligence Contact Asset-driven losses have put pressure on earnings. Investment gains comprise an important part of carriers’ long-term profits, and financial markets have shown just how volatile this source can be. With net income off 60 percent from the first half of 2007 to the first half of 2008, carrier profitability will b ... Continue Reading »
No Surprises, Rates Continue to Fall: P&C Reinsurance Renewals, July 1, 2008
Christopher Klein, Global Head of Business Intelligence Contact Excess capital caused soft market conditions persisted at July property and casualty renewals. For property-catastrophe covers, risk-adjusted pricing dropped 10 percent to 20 percent relative to July 1, 2007. Quote ranges narrowed, though, as reinsurers responded to the realities of the market. The weakening global ... Continue Reading »
Outlook for Florida Renewals on June 1, 2008
Kevin Stokes, Managing Director Contact Florida property-catastrophe risk-adjusted pricing is expected to decline by about 15 percent on average at June 1, 2008 renewals. A competitive reinsurance market and the absence of major insured losses are driving this trend. While disasters are not in short supply, none has had a market-changing impact. ... Continue Reading »
The Market’s Mixed Signals: Reinsurance Renewals at April 1, 2008
Reinsurance renewals at April 1, 2008, sent mixed signals to the global market. Cedents pushed hard for rate reductions in Asia. Reinsurers stood firm, though, as rates in general are already close to technical levels. The majority of rate decreases, therefore, were single-digit. U.S. cedents pushed as well. While reinsurers resisted, competitive forces prevailed, and rate ... Continue Reading »
Tropical Cyclone Review 2007
Tropical Cyclone Review 2007 summarises the season’s tropical cyclones and the impact of the more significant cyclones after landfall. Tropical cyclone activity is reviewed by oceanic basin, covering those that developed in the North Atlantic, Northeast Pacific, Northwest Pacific, Australian and North and South Indian Ocean basins. This report includes an estimation of the e ... Continue Reading »
2008 Reinsurance Market Review: Near Misses Call for Caution
Cedents took advantage of a buyer’s market. Many 2008 renewals closed late as cedents held out for lower rates in the continuing soft market. Reinsurers were rewarded not only with lower rates, but often smaller lines. The absence of large catastrophe losses was a key factor in the softening of reinsurance markets. Barring large catastrophe losses in 2008, the downward drift in ... Continue Reading »
