News State-backed cyber pool must be formed: Catlin


(Continued from top of page 1) and I believe we should do the same for cyber. “The industry could take a meaningful amount of risk—enough that it would be painful if a big event occurred but not so big that it would damage the industry.” He conceded that such ideas take time to


come to fruition and it often takes a disaster to elicit a response. “My only hope is that when that happens,


the first event is big enough to prompt action but not actually cataclysmic,” he said. “I just believe that governments and industry should start working on a solution now.”


Looking backwards Catlin said that one of the great failings of the re/insurance industry is that it tends to view risk through a rear-view mirror. “Risks are changing so rapidly now, that


is very unhelpful,” he said. “We need to start looking forward at how things can change in the future.” This is also the flaw underpinning its


other great failing, Catlin said: the industry’s reluctance to embrace technology to make processes faster and more efficient. He recalled being on the Lloyd’s Franchise Board around a decade ago when Kinnect was


rolled out, an electronic risk exchange which, it was claimed, would revolutionise the market. Well over £50 million was spent on the project before it was unceremoniously scrapped due to a lack of adoption and the view that it was not fit for purpose. More recently, the London Market Group


is exploring ways of modernising the market but, Catlin said, no matter what the resources thrown at the project or the brains behind it, the market will act and come together only when it is forced to—usually by adversity. “The trouble is, unless the bridge is burning


it is very difficult to implement any change,” he said. “In adversity, the market comes together, but the rest of the time, people are loath to change,” he said. The


other problem with previous


initiatives was that they were not driven by senior enough people. “You then get people working on it who do not understand the bigger picture and lack the power to drive it forward,” he said. “Something needs to change. So many


processes in the industry are still reliant on manual data entry and are duplicated many times. The only answer is collaboration and an acceptance that the industry must embrace this or risk being completely left behind.” n


Generali will re-enter ILS but balance with reinsurance (Continued from bottom of page 1) Expanding


on Generali’s reinsurance-buying habits, Urlini said that these had changed over time as a result of soft market trends and Solvency II requirements. “Reinsurance buyers have found opportunities to improve their protection by enlarging the scope of cover, with both higher capacity and improved terms like wider hours clauses or pre-paid reinstatements,” he said. He added that quota share protections


aimed at providing capital relief have become more popular and widely offered by the big reinsurers. “Buyers have also created more structured


reinsurance programmes which use a combination of traditional reinsurance and ILS.” Speaking of the expected requirements at


the January 1 renewals, Urlini said the July 1 renewals showed wide capacity available and strong competition from the reinsurer


side Powered by: MONTE CARLO TODAY Wednesday September 16, 2015


INTELLIGENT INSURER’S MONTE CARLO TODAY IS PUBLISHED BY NEWTON MEDIA LIMITED. Registered Address: Kingfisher House, 21-23 Elmfield Road, Bromley, BR1 1LT, United Kingdom Telephone: +44 203 301 8200 www.newtonmedia.co.uk


Lloyd’s considers forming ‘incubator’ syndicate to write experimental risks


players dedicated to writing new and innovative risks, Inga Beale, the chief executive of Lloyd’s, told Monte Carlo Today. The project could be run in conjunction with a


T


leadership programme Lloyd’s runs with London Business School (LBS), designed to develop leaders within the market with the skills to anticipate and respond to the changing nature of the global insurance industry. “We have been asked to look at the possibility of


DIRECTOR Nicholas Lipinski


forming what would be an incubation syndicate,” Beale said. “The idea is that a number of capacity providers might participate adding different brains and ideas in an attempt to get a better handle on some of the new and emerging risks facing the industry. “We have some excellent people going through


YOUR CONTACTS IN MONTE CARLO John Walsh PUBLISHER Telephone: +44 7803 04 79 86 Email: john.walsh@newtonmedia.co.uk


the LBS programme and this could be an area they work on as part of that. It would be a way of innovating and experimenting with what might be possible while also having a substantial safety net in place in the form of the market.” Beale said that the seed of the idea came from


feedback received in the aftermath of the issuance of the Lloyd’s City Risk Index, a report issued by the market on September 3, which presents the first ever analysis of economic output at risk (GDP at risk)


preoccupy the re/insurance industry are rapidly slipping down the list of the biggest threats that face society.


Manmade risks such as market crash, power outages and nuclear accidents are


increasingly significant, associated with almost half the total GDP at risk. A market crash is the greatest


vulnerability— (Continued top of page 2)


Wyn Jenkins MANAGING EDITOR +44 7715 770 468 wjenkins@newtonmedia.co.uk


Zurich to cut 20 reinsurers from its panel Z


urich Insurance’s reinsurance partners will “feel the bite” this year as the insurer reduces


the size of its reinsurance panel, Paul Horgan, global head of group reinsurance at


Insurance, told Monte Carlo Today. Horgan said that as market


Zurich conditions


continue to soften, the company must reduce costs and access new capital where possible, resulting in a reduction of the number of carriers it will work with. “We’ve been talking about having preferred


partner relationships for a few years, but this is the year when it’s going to start to bite. We’ll be reducing our panel by about 15 to 20 carriers. The panel will still be well over 30 strong, but it is going to come down significantly,” Horgan said. He said the move is partly driven by tough conditions in Zurich’s own business.


market


Although the decline in rates was slowing, action was still needed in terms of cost-cutting. “We don’t think the market’s softening will be as soft as in prior years, but there’s tremendous


PRODUCTION AND DESIGN Fisherman Creative


www.intelligentinsurer.com | www.bermudareinsurancemagazine.com economic becoming


MARKEL’S TWIN TRACK APPROACH TO MARKET SUCCESS


WILLINGNESS TO ADAPT HAS PROTECTED RATINGS


AFTER GROUNDHOG DAY— CHANGE IN THE AIR: JLT RE


he Lloyd’s Market could form a new syndicate funded by a consortium of Lloyd’s


Inga Beale


in 301 major cities from 18 manmade and natural threats over a 10-year period. Based on research by the Cambridge Centre for


Risk Studies at the University of Cambridge Judge Business School, the index finds that a total of $4.6 trillion of projected GDP is at risk from manmade and natural disasters in these cities around the world. It found, however, that many of the perils that


THE ILS PATH TO SUCCESS: AON


SUNCORP INCREASES PROGRAMME


XL CATLIN STRESSES ONE RISK APPETITE GLOBALLY


ANTARES AND QATAR TO BUY REINSURANCE AS ONE


KPMG: EXTERNAL PARTNERSHIPS HOLD THE KEY TO INNOVATION


PEAK RE TO LAUNCH IN ZURICH


PERILS UNVEILS PRE- WINDSTORM FORECASTING WEBSITE


HAMILTON RE TO ENTER PROPERTY FAC MARKET


BERMUDA AWAITS IRS RULING ON NEW RULES


DIGITISATION IS CHANGING BUSINESS MODEL: MUNICH RE


What’s inside


16.09.15 TUESDAY


pressure on us to continue to lower our reinsurance spend,” he said. “So we’ve worked with our brokers to work out what are more efficient ways to buy.” Zurich will look to protect its relationships with


its core carriers—but at the expense of others, which it will cut completely. Horgan said spend with these core partners may be reduced by just a couple of percentage points but he is hoping to keep spend with them consistent. “For some of our core carriers—we have eight to 10 (Continued bottom of page 2)


DAY 4: Wednesday September 16 2015 | MONTE CARLO TODAY | 1


©Newton Media Limited 2015. All rights reserved.


No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electrical, mechanical, photocopying, recording or otherwise without the prior written permission of the publisher.


The views expressed in Intelligent Insurer’s Monte Carlo Today are not necessarily those shared by the publisher, Newton Media Limited. Wishing to reflect the true nature of the market, the editor has included articles from a number of sources, and the views expressed are those of the individual contributors. No responsibility or liability is accepted by Newton Media Limited for any loss to any person, legal or physical, as a result of any statement, fact or figure contained in Intelligent Insurer’s Monte Carlo Today. This publication is not a substitute for advice on a specific transaction.


despite some refusals on particularly aggressive offers.


“Given the lack of significant catastrophe


losses from now to the end of the year and in the presence of positive results in reinsurers’ balance sheets, expectations are for a market still favourable to the buyers. Improvements of terms will still be possible especially when focused on the scope of cover such as terrorism, hours clauses, reinstatements, etc,” he said. “We still see the market as a buyer-


favourable framework and we have the feeling that recent mergers and acquisitions will push the reinsurers to fight in order to maintain or improve their present positioning in the market. “The challenge for Generali, as a buyer, will


be that of achieving the most attractive terms and conditions by keeping a high level of quality and maintaining the consolidated relationships with key players in both the traditional and the ILS markets.” n


2 | MONTE CARLO TODAY | DAY 4: Wednesday September 16 2015


The publication of advertisements does not represent endorsement by the publisher.


Intelligent Insurer – ISSN 2041-9929


Franco Urlini www.intelligentinsurer.com | www.bermudareinsurancemagazine.com


DAY 4


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28