The large majority of protection buyers expect to purchase either the same or more reinsurance at the January 2019 renewals, with most anticipating a greater use of third-party reinsurance capital, according to the Reinsurance News and Artemis Reinsurance Market Survey.
The survey reveals that over 86% of respondents, of which almost 63% either make or provide input to reinsurance buying decisions, expect to purchase either the same amount (46.4%), or a little bit more (40%) reinsurance protection at 1/1 2019.
6.4% of survey respondents said they expect to buy significantly more reinsurance protection at 1/1, while the same percentage said they expect to buy a little less protection. Just 0.8% of respondents said they anticipate buying significantly less reinsurance coverage at the January 2019 renewals.
Overall, dedicated reinsurance capacity has continued to increase in recent years, although this has largely been driven by alternative reinsurance capital growth as traditional capital expansion has slowed, or stayed flat.
The increased acceptance of insurance-linked securities (ILS) capacity within the global insurance and reinsurance industry has led to a rise in the utilisation of alternative capital by traditional market players, and the survey suggests that this trend is going to continue.
50% of survey respondents said they will use a little more ILS and third-party capital at the January 2019 renewals, with just under 30% saying they will use about the same. More than 15% of survey respondents expect to use significantly more ILS and third-party capital at 1/1 2019, while 2.9% expect to use a little less, and just 1.9% expect to use significantly less.
So, according to the Reinsurance News and Artemis Reinsurance Market Survey, it’s likely that most protection buyers will increase their reinsurance utilisation or keep it flat at 1/1 2019, but that the volume of third-party capital and ILS within this will expand.
About the survey:
The Reinsurance News and Artemis global reinsurance market survey was conducted via direct outreach to our senior reinsurance and insurance-linked securities (ILS) market readership, across both Reinsurance News (73,000+ unique readers in September 2018*) and Artemis (60,000+ unique readers in September 2018*).
The survey includes responses from hundreds of identifiable re/insurance and ILS market participants, including numerous from reinsurance market CEO’s and other senior decision makers from across the space.
Overall, more than 62% of survey respondents provide input to or are responsible for reinsurance buying decisions.
Based on Google Analytics unique user numbers.
The full results of the survey are freely available online and we’re happy to discuss them with industry participants. We’re interested to hear your thoughts.
