Retrocession

The retro market needs to deliver better transparency to attract investors, but a roundtable of senior executives was split on the outlook for the roughly $20bn market.

Ratings agencies remain positive on reinsurers boosting their use of retrocession to grow, despite this year’s capacity crunch in the retro segment.

The carrier launched the retrocessional ILS fund this month with Andrew Barnard as CEO.

Markel and a new venture from ex RenRe exec Eklund are also tapping up investors.

Participants predicted the rate pressure that has been centred on Japan and Florida would have a broader spill-over next year.

The potential for insured catastrophe losses has increased at an “exponential” rate since the 1970s, the broker said in a report.

If reinsurance markets continue to be squeezed by higher retro rates, will this drive more fundamental repricing in underlying business?

Andrew Barnard will serve as Lodgepine CEO with two other Markel staff, Jamie Welsby and John Duda, joining as key executives.

Reinsurance conditions began moving in investors’ favour in mid-year 2019, marking a delayed reaction to 2017-2018 losses.

The new Alternative Capital Partners entity unites the resources and capabilities of both teams, Swiss Re said.

Continental reinsurers and Lloyd’s pulled back use of collateralised retro but overall reinsurance use of ILS retro rose from 2015 to 2018.

Trading Risk looks at the dominant themes that the ILS market will be discussing at the 63rd Monte Carlo Reinsurance Rendez-Vous in September.