14 September 2015 News

Allianz Re seeks per-event cat cover for emerging regions

Allianz Re, the company responsible for the Allianz group’s retrocession portfolio, is seeking more protection in this year’s renewals, especially per-event cat cover for emerging regions, the company’s buyer told Monte Carlo Today.

Wolfgang Wopperer, global head of retrocession business at Allianz Re, said: “Final decisions have not yet been made, but as a trend we plan to enhance our protection level rather than to reduce it. One area for additional purchase could be per-event cat cover for emerging regions.”

This is a departure from last year when Allianz Re purchased more comprehensive, traditional coverage.

Wopperer said he expects the buyer’s market to continue through the renewals, although the pace of rate declines will start to slow, he believes.

“We expect that the rate decrease will slow down, but do not yet expect a market hardening for the January 1 renewals,” he said.

The challenging market conditions have forced reinsurers to become more proactive and innovative, he believes, but he also stressed that more fundamental change in this department will not happen overnight.

“A change has occurred, definitely yes, but this cannot be achieved in the short term as a change of the business policy and investments are needed,” he said.

Asked about his predictions for the future, Wopperer expects more M&A activity in the forthcoming 12 months with this trend likely to continue in the longer term.

“Much depends on the interest rate environment in five years from now and on the events that we will see until that date. In any case, we will see a consolidated market with fewer players, on both the traditional and the investor side," he predicted.

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