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Swiss Re assures investors that global opportunities abound

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Swiss Re Ltd. told investors Tuesday that it would ensure the fast allocation of capital to new and existing risk pools and revenue streams.

At the reinsurer's investors' day, Swiss Re said the current insurance market is facing the challenges of low interest rates and industry consolidation, while at the same time low insurance penetration in many parts of the world creates “ample opportunities.”

“At the heart of our transformation journey is our aim to be an agile capital allocator in insurance and associated asset risks,” said Michel M. Lies, group CEO, in a statement.

Swiss Re said that it would aim to “execute on its capital allocation by having unique access to attractive risks.”

“Geographic diversification is one way of doing this,” it said.

Swiss Re said it would aim to increase the share of premium and fee income earned from targeted high growth markets to 30% by 2020 from the 27% recorded in 2014.

The reinsurer said it would seek to broaden its client base and engage new clients such as governments and multilateral institutions to help them fill “protection gaps.”

Swiss Re said that its financial targets for 2016 and beyond were a return on equity of or above 700 basis points above the risk free rate measured by 10-year U.S. government bonds.

The property/casualty reinsurance division will target a 10% ROE; the life and health reinsurance unit will target a 10% to 12% ROE; and the corporate solutions unit will target a 10% to 15% ROE, Swiss Re said in the statement.