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Premium growth forecast for German market: Hannover Re

23rd October 2017 - Author: Staff Writer

Hannover Re forecasts modest market growth for its subsidiary, E&S Rueck, with rate increases for loss-impacted programmes and increased demand in cyber and telematics risks, in the upcoming January 1st renewals.

Hannover Re logoRate improvements are expected in motor insurance lines; prices for natural catastrophe covers are predicted to at least remain stable.

“When it comes to pricing risk-oriented covers the low interest rate level continues to be a major factor, especially for longer-tail casualty business, with the result that premium adjustments are needed in most instances”, Michael Pickel, a member of the company’s Executive Board, said at a press conference held during the week-long meeting of reinsurers in Baden-Baden.

“In view of the rising cost of all material claim items in motor third party liability insurance, we anticipate improvements in conditions for the upcoming treaty renewals as at 1 January 2018.”

Additional premium income is expected from the trending sectors of cyber and telematics, where rising demand already seen in other markets is spreading to Germany.

The increasing prevalence of natural disasters experienced this year and in 2016, where severe weather events with heavy rainfall caused insured losses to soar to almost ten times as high as in 2015, will likely cause cedants to review and increase their reinsurance demands, said Hannover Re.

E&S Rueck, in cooperation with the start-up “Perseus,” offers German SMEs a service platform for cyber security solutions and risk management – and expects premiums in these lines to increase along with demand for cyber policies.

The Hannover Re branch is developing a pilot project to offer German motor insurers easy access to telematics with British multinational telecommunications company, Vodafone.

“Through our involvement in this project we are seeking to expand the existing range of services offered to our customers. As the largest German motor reinsurer, we intend to partner with our clients on new products going forward, as we have in the past,” Pickel said.

The pilot aims to standardise the framework contractual conditions for a telematics product to make their application straightforward and cost-effective for insurers.

Hannover Re said it looks forward to growing opportunities for E+S Rueck in Germany for 2018 and considers itself well on track to maintain its market share on a high level.

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