Niche reinsurers still have a role, reveals II survey
Despite the wave of consolidation in the reinsurance industry at the moment, many believe that there remains a role for smaller, niche players, a survey by Intelligent Insurer has revealed.
Just over 90 percent of respondents to the online survey said they believed smaller, niche players still have an important role and that bigger is not always better when it comes to the reinsurance industry.
“Appetite and spread of risk will always allow for smaller, niche players in the market. A small handful of large companies simply can't write everything and pay all of the losses, nor can they service that volume of risks properly,” said one participant.
“We're also in an industry with such a low barrier to entry that start-ups will always be in play and by default create small, niche players if others are purchased or merged with larger carriers.”
Others added that the industry still needs experts in different fields, with one participant explaining that “if all other things are equal, like ratings and size, then expertise will be the differentiator between companies.”
A number of participants added that there is always room for innovative, forward-thinking and out-of-the-box solutions in the market with niche expertise, with one adding that “Nimble underwriting still comes from a small dedicated staff of professionals”.
On the opposite side, one participant said: “Size, diversity and a global reach will become ever more important as will access to different forms of capital and these are all attributes associated with scale.”
The survey is still open. Click here to have your say.
