With the annual Rendez-Vous de Septembre (RVS) event in Monaco set to return shortly, Reinsurance News recently spoke to Pete Chandler, BMS Re’s Chief Executive Officer, US, about what the firm expects to see at this year’s event.
He explained that he believes that we are seeing a “revitalization” of the convention and how there are likely to be more attendees this year who have more capital to deploy, as well as an increase in purchasers of reinsurance, compared to last year; recent hiccups in the ILS market aside.
“We think there is more capital available in the market today than there has been in the recent past as certain underwriters had been holding back for this exact market environment, and many are going to be looking to deploy. So, I’m expecting a very lively convention this year, and BMS is certainly doing its part to increase the population year over year of attendees.
“This year we have much more to talk about as our organization has evolved tremendously across the last 12 months, and that is exciting for all of us.”
Moving forward, Chandler then discussed his current views on capital availability at this time within the industry, as well as how he thinks the industry as a whole can do better at attracting more capital at lower costs of coverage.
“We believe that there is adequate reinsurance capital, in all of its forms, for the industry as we sit here today, and do believe that there is more coming in. Having recently spent time in both the UK and Bermuda, we were made aware of at least half a dozen new ventures that are getting off the ground.
“Some are further along than others structurally, and some are certainly further along their capital raises than others. We do believe that ours is an industry that attracts capital and continue to believe that the global capital markets have available capital to deploy right now, and they are looking specifically at the (re)insurance market as an attractive platform upon which to put their capital to work.
“We would argue that both the insurance and reinsurance industries are areas where the ease of entry makes us an attractive industry to deploy capital.”
Chandler also noted how BMS Re’s views reinsurance as a hybrid form of capital and they consistently work towards bringing it to bear on behalf of their clients, as well as allowing them to make decisions on the efficiency and effectiveness of those various forms.
“We do firmly believe that capital adequacy exists today and ultimately, mother nature is going to be the one that’s going to have the biggest say on whether that is going to be the same thing come January.
“However, today there is more that’s coming because veteran underwriters are seeing this as an underwriter’s market and they want to take advantage of those opportunities that exist today because of the direction of rates and pricing, as well as terms and conditions. The migration to E&S has been profound.”
Meanwhile, as the industry slowly begins to shift towards the end of year renewals, Chandler commented on what BMS Re’s outlook currently looks like.
“We believe it will continue to be a sellers renewal season, following on Idalia and other global events. The vast majority of companies continue to require reinsurance, rating agencies demand that they utilize outside capital to support their balance sheet to protect themselves from catastrophic types of events.
“We also feel that it’s an area within this phase of the market cycle, whether you’re an underwriter, broker, or purchaser of reinsurance where we all have the opportunity to practice our respective crafts, and on an absolute value basis, look at each transaction individually and deliver tailored structures, pricing and solutions.
“Overall, we would have to say that we have not experienced a market like this one in a long time and it really is going to be an opportunity for the cream to rise to the top. As we continue to get closer to January, we think it is going to be a good time to be deeply involved in the market, to further strengthen both trading and personal relationships and really set the tone for the remainder of 2023 and beyond.”
