Weak Profits Leading to Takeovers of Smaller Reinsurers
Wednesday, 09 14 2016, Category: Insurance and Reinsurance, Country: World
Weak profitability is likely to leave more reinsurers worldwide vulnerable to takeover in 2017, reinvigorating mergers and acquisition activity as healthier firms seek growth and efficiency savings, according to Fitch Ratings.
Consolidation in the sector has stalled after a flurry of deals in 2014 and 2015 as potential buyers have been put off by high valuations. But Fitch analysts believe the combination of overcapacity, which will continue to weigh on premiums, and worsening investment returns will reduce profits for many firms in 2017.
Source: Insurance Journal