MONTE CARLO, Monaco,
Sept. 12, 2016 /PRNewswire/
-- Aon Benfield, the global reinsurance intermediary and
capital advisor of Aon plc (NYSE:AON), has released the
September 2016 edition of its
Reinsurance Market Outlook report, which provides a comprehensive
analysis of the key variables affecting reinsurance buyers in the
approach to the January 1 reinsurance
renewals.
The report reveals that reinsurance demand has increased over
the past 18 months, with the cession ratio across the global
property and casualty insurance industry registering a small rise
for the first time in several years, and the trend expected to
continue for the remainder of 2016.
Eric Andersen, CEO of
Aon Benfield, said: "The catalysts
for this increased demand for property and casualty reinsurance
include factors such as the emergence of poor underwriting results
in certain casualty classes, out-sized losses from regional
exposures, and the introduction of the Solvency II regulatory
regime across the European Union."
Meanwhile, the report highlights four key emerging areas of
growth for the re/insurance industry:
- Property Catastrophe – demand for property catastrophe
protection is expected to remain relatively stable for January 2017 renewals, absent any material
reinsured loss events. While certain regions affected by regulatory
changes may look to secure additional capacity, overall demand
change is expected to increase by approximately five percent across
the market.
- Mortgage – the demand for re/insurance of US mortgage
default exposure continues to grow, driven by both new and existing
cedents. Most of the re/insurance purchased is driven by new
regulatory capital requirements, as government entities Fannie Mae
and Freddie Mac continue to access private markets for credit risk
transfer. To date, Aon Benfield has
placed around USD10 billion of
reinsurance capacity in this sector, which equates to approximately
USD2.5 billion of projected lifetime
ceded premium.
- Cyber – demand for cyber insurance coverage and product
continues. With approximately USD1.7
billion in premium, nearly 90 percent of the market is based
in the United States, with annual
growth running at 30 to 50 percent. International growth will be
driven by upcoming European Union regulations covering data
protection that will become effective in 2018.
- Crop – While a more mature market, crop re/insurance has
returned to profitability in the US. Growth has mainly emanated
from Asia with the Indian market
seeing five times the insurance premiums for the 2016/2017 season
compared to the year prior. Thailand has also seen growth, albeit not as
significant.
The report further reveals that the low interest rate
environment that has persisted in the developed world since the
2007 financial crisis has had a pervasive effect on traditional
re/insurance carriers that are mainly invested in cash and bonds,
and has significantly influenced market behaviour.
The full report can be found at http://aon.io/2c687qL
Further information
For further information please contact the Aon Benfield PR team:
Andrew Wragg (+44 207 522 8183 / 07595 217168) David Bogg or
Alexandra Lewis
Follow Aon on Twitter: https://twitter.com/Aon_plc
For information on Aon plc. and to sign-up for news
alerts: http://aon.mediaroom.com
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SOURCE Aon plc