Need to cede outside traditional renewal cycle
Friday, 06 10 2016, Category: Insurance and Reinsurance, Country: World
The current softening and competitive nature of the reinsurance landscape sees companies fighting for a seemingly shrinking share of business during renewals, suggesting that it might be wise to seek deal completion outside of the traditional renewal cycle.
The January, April, and mid-year renewals are generally when the majority of reinsurance and insurance-linked securities (ILS) agreements are finalised, typically annual, or multi-year contracts that are subsequently renewed during the same part of the renewal cycle as the original transaction.
However, with competition from both traditional and increasingly alternative reinsurance capital providers intense, driven by expansion of the ILS sector, the sustained period of benign large losses, and ultimately substantially reduced rates, the traditional reinsurance renewal cycle might not be the best time for firms to secure business.