Charles Franks, Chief Executive Officer (CEO) of Tokio Marine Kiln, predicts an “exciting” rating environment in 2018 in response to third-quarter catastrophe events, while the company’s Lloyd’s Syndicates continue to show improvements.
“The outlook for the rating environment is very exciting. For the first time in years, we are seeing prices showing marked increases as the market responds to the third quarter catastrophes. We are poised to seize appropriate opportunities as they arise, focusing on strategically important areas that play to our strengths and enable our customers to thrive, whilst maintaining underwriting discipline,” said Franks.
Franks is the latest re/insurance industry executive to note an expectation of rate increases in 2018, as the market adjusts to the impacts of an active quarter for catastrophe losses.
Tokio Marine Kiln Syndicates Limited (TMKS) operates three Lloyd’s of London syndicates, and Franks’ comments suggest that positive price movements are being seen in the Lloyd’s marketplace, although this isn’t specified.
Syndicates 510 and 557 have both shown improvements on the 2015 year of account after a benign quarter, while 510’s forecast for the 2016 year of account reflects losses from recent hurricane events.
For 2015 year of accounts, Syndicate 510 capacity totalled $1.063 billion, a forecast range of 7.7% – 12.7%, up from 7.2% – 12.2% in August 2017. Syndicate 557 capacity totalled $35 million, a forecast range of 26.3% – 31.3%, compared with 23% – 28% in August, 2017. While Syndicate 308 capacity totalled $32 million, a forecast range of -11.9% – -6.9%, compared with -9.7% – -4.7% in August, 2017.
For the 2016 year of accounts, Syndicate 510 capacity totalled $1.062 billion, a forecast range of -3.3% – 1.7%, compared with -1.4% – 3.6% in August 2017. Syndicate 557 capacity totalled $35 million, a forecast range of 10% – 15%, compared with 9.1% – 14.1% in August, 2017. While Syndicate 308 capacity totalled $32 million, a forecast range of -14.4% – -9.4%, compared with -0.9% – 4.1% in August, 2017.
“Tokio Marine Kiln Syndicates Limited has applied for the cessation of its Life syndicate 308 to Lloyd’s and the syndicate members. We are committed to ensuring existing business is serviced to the highest standards and that there will be no detriment to policyholders as a result of this action. No other syndicates or business lines, including Accident and Health business written through Syndicate 510, are affected by this decision. Further communications will be shared once these discussions have concluded,” explained Franks.
Adding; “The significant claims arising from Hurricanes Harvey, Irma and Maria are serving to demonstrate the true value of insurance. Our main priority is to support our customers who have been affected by these devastating catastrophes by handling claims promptly.”
