Entries Tagged as 'Reinsurance'
It’s nice to see some sanity returning to cat treaty pricing (assuming no mega-catastrophes), especially as those of us at primary insurers head into “planning season”. Quoting Business Insurance:
Catastrophe reinsurance rates have dropped an average of 10% in 2008 compared with a 6% decline in 2007, according to a report released Monday by Guy Carpenter & Co. L.L.C.
It’s mentioned in that article and at a few other sources that, to the extent that reinsurance costs still seem high, part of that is conservatism imposed by backlash from the ongoing credit crunch. While the industry is comfortable with the amount of capital available to cover most mega-cats, reinsurers are understandably concerned with what might happen if they needed to recapitalize after such an event.
Tags:
Catastrophes · Insurance · Reinsurance
30 May 2008 · Comments Off
Let’s hear it for the free market! Seen at Business Insurance:
Florida property catastrophe reinsurance rates will likely fall by 15% on average during mid-year renewals, according to a report released by Guy Carpenter & Co. L.L.C. [...]
The sharpest price decreases include 18% to 25% reductions for the higher layers of reinsurance, attaching above the Florida Hurricane Catastrophe Fund, according to the report.
Lower layers of reinsurance, below the FHCF, are declining by 7% to 10%, while private reinsurance layers usually placed alongside the FHCF are decreasing by 12% to 15%, compared with June 1, 2007, renewals, according to the report.
I know that a lot of reinsurance departments at property insurers are looking forward to a bit of relief, given the softer market and a couple of relatively quiet years in North America. (Yes, it’s been a bad tornado season , but such storms don’t generally impact cat reinsurance industrywide.)
I expect that regulators in certain states will also welcome the news that primary insurers will see a little relief. I do wonder, however, if regulators will remember that it’s difficult to reduce rates when increases requested in part due to increased reinsurance expense weren’t fully granted in the first place.
Tags:
Insurance · Florida · Florida Homeowners · Property Insurance · Reinsurance
25 February 2008 · Comments Off
Seen at Business Insurance:
All five defendants in the General Re Corp. finite trial have been found guilty on all counts they faced in a case over their roles in allegedly bogus loss portfolio reinsurance transaction from 2000 designed to help American International Group Inc. inflate its loss reserves.
The five defendants—Gen Re Chief Executive Officer Ronald E. Ferguson; Christopher P. Garand, former senior vp in charge of U.S. finite underwriting for Gen Re; Robert Graham, former senior vp and legal counsel for the reinsurer; Elizabeth Monrad, Gen Re’s former chief financial officer; and Christian M. Milton, AIG’s former vp for reinsurance—were found guilty by a jury on various counts of conspiracy to commit securities and mail fraud and making false statements to the U.S. Securities and Exchange Commission.
And meanwhile, many of us have been subjected to painful hours of continuing ed over exactly what constitutes “risk transfer” in the wake of that scandal.
Tags:
Insurance · Finite Risk · Reinsurance
