September 2014 Bermuda:Re/insurance+ILS 23


as adequately priced,” said Gharib. Add in the prospect of unexpected losses such as the Thai floods, and emerging market prospects appear unlikely to offset sluggish reinsurance growth in developed markets, he explained.


Add into that mix changing reinsurance-buying appetites among the larger cedants—who have “upstreamed their reinsurance decisions to the holding company level” in order to optimise their portfolios, strengthen their negotiating positions and achieve improved pricing— and insurers are tending to favour larger reinsurers offering bundled coverage, said Gharib.


This is putting pressure on smaller reinsurers to scale up, particularly those that are focused on more commoditised products such as property cat, or players that cannot deliver a compelling value proposition. Many smaller and medium-sized players are turning to possible deals as a result.


As Jed Rhoads, president and chief underwriting officer for property reinsurance at Markel Global Reinsurance explained, “We are seeing scale matter more and more”, with the pursuit of growth evident throughout the marketplace. He said that as the largest re/insurers have grown, the broker markets have had to respond too.


M. CORNELIUS / SHUTTERSTOCK.COM


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