French reinsurer CCR Re is optimistic about the future following continued development and is confident of profitable growth, supported by its new ownership and capital injection, according to Deputy Chief Executive Officer (CEO), Laurent Montador.
In an interview with Reinsurance News at the annual meeting of the reinsurance industry in Monte Carlo, Montador commented on the reinsurer’s experience at RVS 2023, and where he sees opportunities following the company’s evolution.
Discussing his views on the 65th edition of RVS, Montador explained that CCR Re “had excellent discussions with our clients and partners, sharing our views about risks that change in nature.”
“Climate change, inflation, compensation dynamics are in need of recalibrations and a revisit of our models. This greater uncertainty push for more demand of covers. We’ll be present with them for a stable and long-term partnership,” he added.
After a positive and productive RVS for CCR Re, which came at a perfect time for the reinsurer given its recent evolution, Montador told Reinsurance News that there’s ample room for growth in existing and new lines of business.
“We have developed quite a lot,” said Montador. “We think that with our existing portfolio we can continue to grow. We have an average share of placement between 3% and 4%, so we can effectively increase that naturally.”
Montador explained that after SMABTP and MACSF completed the acquisition of CCR Re and provided it with an additional €200 million of capital, the company wants to leverage that new capacity to enter more lines of business.
“We see many opportunities in terms of higher demand from the cedents, and this is in all lines of business. Of course, in property cat, but also in other lines as well.
“But of course, you have also the measurement of inflation, which is still quite high and continuing longer than expected. So, this has to be taken into consideration by all the actors.
“In property cat this is crucial, but also in casualty the rates have not moved so much, and I think inflation should be taken more into consideration,” said Montador.
In recent times, CCR Re has improved its platform with new hires and also new capabilities within IT, which Montador said enables the firm to see more than it has in the past.
Ahead of the renewals, and supported by new advances within the company, CCR Re will focus on increasing reinsurance pricing, stressed Montador.
“Probably retentions will stay as they are, and the pricing will go up, or both. It was a must last year. Inflation is here to stay, and this can and must be considered on the pricing side,” he said.
Expanding on this, Montador explained that what the client has to understand is that effectively the reinsurance market still has to deal with inflation.
“The goal for Europe could be to reach 2% but we are far from that, and it will take time to reach that level, so we really have to take that into account in our pricing,” he added.
All in all, CCR Re anticipates “a stable and early renewal in a hard property retro market, with momentum for alternative solutions,” said Montador.
“As all market players, we do have concerns about the impact of secondary perils. We foresee emerging solutions on a named based basis,” he continued.
Montador also noted how he expects cedents to ask for additional upper layers, emphasising that “CCR Re will be present for our clients to provide capacity, and always with the spirit of having more lines of business with profitability as the main driver.”