MONTE CARLO, Monaco — The influx of new capital into the reinsurance industry is a “normal phenomenon” and has advantages for reinsurers, according to the chairman of the organizing committee of the Rendez-Vous de Septembre reinsurance gathering in Monte Carlo, Monaco.
At a briefing Tuesday, Claude Tendil, chairman of the RVS association, said inflows of new capital market capacity into the reinsurance industry should not be viewed by traditional companies as a worrying trend.
He said reinsurers can make use of the new capital as a form of retrocessional coverage, among other benefits.
Reinsurance market stable
Mr. Tendil also said the global reinsurance market is largely stable, noting that while the frequency of natural catastrophe events is increasing, those losses “appear to be decreasing in severity.”
In 2012, there were 905 natural catastrophe events, he said, compared with 820 the previous year. But those events caused fewer fatalities — 9,600 — than the 10-year average of 106,000 per year.
In the first half of 2013, Mr. Tendil said, the number of natural catastrophe events has been slightly higher than the average for the past 10 years — 460 events in the first half of 2013 compared with a 10-year average of 390.
But overall, both economic and insured losses stemming from those events have been lower than the 10-year average, Mr. Tendil said.
While natural catastrophes caused €35 billion ($46.13 billion) in economic losses in the first half of 2013 compared with a 10-year average of €66 billion ($86.98 billion), insured losses from those events were about €10 billion ($13.18 billion) compared with a 10-year average of €17 billion ($22.40 billion), he said.
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