More cedants are using reinsurance to reduce their earnings volatility as they attempt to make their businesses more attractive to investors in a low-yield environment, Jean-Paul Conoscente, chief executive of P&C reinsurance business globally at SCOR, told Baden-Baden Today.
Combined with demand for capital protection and solutions to solvency requirements, this is also driving higher demand for reinsurance.
“The demand for reinsurance is still increasing; not from increased severity cover, but rather from earnings protection,” Conoscente said.
“They want to protect the P&L as well as the capital.”
He explained that this trend is partly driven by the low investment yield environment. This continues to put pressure on re/insurers and forces them to focus on producing positive technical results.
“We are seeing companies increasingly seeking earnings protection. Insurers are interested in solutions that protect against large variations in their results. In the end, it’s a question of structure and price,” Conoscente said.
Several big natural catastrophes this year, including Hurricane Michael in Florida and Typhoon Jebi in Japan, are unlikely to affect the…
