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f the market is studied in segments and the behaviour of individual buyers examined, it


“There are new players knocking at the


becomes clear that not all cedants are retaining more, Dirk Spenner, head of Europe North/ East/Central at Willis Re, told Baden-Baden Today. Spenner explained that the perception that


cedants are retaining more does not take into account standard reinsurance buyers—the focus is more on specialty groups and big insurers. “The traditional buyers of reinsurance are


not buying less. Insurers look at their needs, partly driven by Solvency II, and might even buy more or, in some cases, buy differently. “They optimise retention management. This


might lead to less volume in the open market, but the trend of insurers buying less is not one that we see throughout Europe,” he said. Spenner added that there is, however, a


trend towards buying consolidated covers, an area in which he claims Willis Re is a market leader in Europe.


door and there’s been a change in buying behaviour. It’s not radical in all lines, but we can clearly see that Solvency II will become something that influences the way cedants value their protections and select the ways in which to protect themselves,” he said. In this changing environment, he believes


Willis Re is working hard to maintain its market share and client focus. “For Willis Re, the key thing is advice. Over


the years, the biggest change in our environment has been our move from having not only a very strong focus on a transactional model to having a focus on analytical advice as well,” he said. He declined to comment on the news that


Willis is in talks to merge some units with rival Miller, but he did say he expected mergers and acquisitions (M&A) in the industry more generally. “The market is set up to expect a lot of M&A activity in respect of carriers, but there


21.10.14 TUESDAY


Not all cedants are retaining more I


Dirk Spenner


is no evidence of this at the moment,” he said. On alternative capacity, he commented that


insurance-linked securities (ILS) players have a significantly lower market share in Europe than in the US. The cost of capital for most funds will be lower than that of traditional reinsurers’ cost, he explained, but traditional reinsurers benefit from risk diversification. This allows them to be more competitive than ILS players in Europe. n


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