With Solvency II implementation just months away, the run-off market is experiencing heightened activity, a vast upscale in transaction sizes and ambiguity between ‘pure’ run-off deals, as Arndt Gossmann, CEO, DARAG, tells Intelligent Insurer.
With Solvency II just months away, are you seeing a difference in run-off activity?
Over the past nine months we have certainly seen a significant increase in the number of proposed deals. While some have already been concluded, there are many transactions still in progress in the market. We are also seeing a significant increase in the average deal size.
The estimated total volume of discontinued business in 2014 was €242 billion ($272 billion). PwC is due to publish the 2015 figures. Even more interesting than the development of the total volume is the increase of the qualified market potential. The number and the size of run-off portfolios that are being transferred is growing significantly throughout Europe. By now the level of activity in the formerly more active UK and in Continental Europe is the same. We expect run-off deals to double in 2015 compared to 2014 (€1.4 billion).
Arndt Gossmann, DARAG, Europe