Economic recession changes the rules in insurance
 European insurance companies could be forced to pay more for reinsurance coverage in the 2009-2010 renewal season, following the financial crisis affecting the world economy, , Jean Philippe THIERRY, Chairman of the Organizing Committee of Rendez-Vous de Septembre in Monte Carlo, stated for the XPRIMM Publications. THIERRY, who runs one of the largest insurance companies in France, AGF, now part of ALLIANZ Group, believes that negotiations that mark the end of the year will focus more than ever on matters such as financial security and capacity offered by the reinsurers, rather than on prices.
Many analysts present in Monte Carlo appreciated that if the pressure of the prices charged by reinsurers will become too strong, then primary insurers may be tempted to find viable alternatives to traditional reinsurance: securization of the risks, increasing the retention or setting-up pools. Meanwhile, everyone hopes that the end of the year will not bring a new wave of natural disasters, which would certainly bring in liquidity problems for some small and medium sized players.
"I am sure that, by the beginning of 2010, insurers and reinsurers will find the necessary balance of this business", Jean Philippe THIERRY concludes.
In this context, major reinsurers reacted and announced in Monte Carlo the establishing of an association - GRF (Global Reinsurance Forum), meant to promote stability and free competition in the industry. In fact, the objective seems to be to create a common front with increased negotiation power in the relationship with the insurers and the supervisory and control authorities. MUNICH Re, SWISS Re, SCOR, GEN Re, HANNOVER Re, PARTNER Re are only some of the great names that were involved in this initiative, whose stake is developing a global business that exceeded EUR 130 billion in 2008.
"At this point, we cannot talk about an unitary representation of the reinsurance industry - which will promote its interests globally", Denis KESSLER, CEO of SCOR, says.
Rendez-Vous de Septembre takes place, for 53 years, in Monaco and reunites the major players in the insurance, reinsurance and brokerage industries, being one of the two major international meetings, along with the one in Baden-Baden (Germany). Around 2,500 specialists from 80 countries attend every year the event which marks the start of the period of negotiating reinsurance treaties.
Author: Alexandru CIUNCAN, Vlad PANCIU
on 08.09.2009
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