With the majority of 2019 reinsurance renewals now complete, the impact of significant catastrophe activity has evolved from a year ago. Capital inflow levels and risk appetites are responding accordingly. Crucially, alternative capital dipped slightly in the first half of 2019 for the first time since 2012 to USD 92 billion as investors responded to evolving risk measures and ... Continue Reading »
A.M. Best
TRIPRA: The Need to Ease Rating Agencies and Regulators’ Concerns
In 2018, the minimum industry trigger for the Terrorism Risk Insurance Program Reauthorization Act of 2015 (TRIPRA) increased to USD 160 million, contributing to continued rating agency concerns. In late 2017, A.M. Best updated its terrorism methodology and fully integrated the peril into its stochastic Best’s Capital Adequacy Ratio (BCAR) Model. ... Continue Reading »
Reinsurance Market Assessment: What the Numbers Reveal about the Current Industry Status. Chapter 1
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. ... Continue Reading »
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. According to the analysis, capital dedicated to reinsurance continued to grow in 2017 despite catastrophe losses. Due to ongoing excess supply and overall market resilience at January 1, rate firming was generally moderate and pricing shifts focused ... Continue Reading »
Critical Tool for Making Strategic Enterprise Risk Management Decisions
Thomas Hettinger, Managing Director, Strategic Advisory Contact 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 Companies will be under extra pressure to choose growth strategies carefully because of potential capital ... Continue Reading »
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. ... Continue Reading »
Integrating Growth and Enterprise Risk Management – GC@PCI Commentary
Thomas Hettinger, Managing Director, Strategic Advisory Contact 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 Companies will be under extra pressure to choose growth strategies carefully because of potential capital ... Continue Reading »
Guy Carpenter Advances Capital Modeling Capabilities with MetaRisk® 10
Guy Carpenter & Company today announced the launch of MetaRisk® 10, which significantly enhances automation, adds support for A.M. Best's new stochastic-based Best's Capital Adequacy Ratio (BCAR) and enables modeling of "hours clauses." ... Continue Reading »
Emerging Practices in Risk Tolerances: Part II
Brian C. Fischer, Managing Director, GC Analytics® Contact As A.M. Best implements a new rating methodology with enterprise risk management (ERM) as a specific rating category, risk tolerances will play an increasingly important role with the potential to further differentiate risk profiles in Best's evaluation of companies' risk and capital needs. Risk tolerances will ... Continue Reading »
Emerging Practices in Risk Tolerances: Part I
Brian C. Fischer, Managing Director, GC Analytics® Contact Insurers have long embraced the concept of risk tolerances. In some cases, the risk tolerances were expressly stated in a company's enterprise risk management (ERM) policy document or in other cases exhibited in the course of normal operations. ... Continue Reading »
