The reinsurance industry is tending to split into two: some players will offer increasingly commoditised products against a backdrop of fierce price competition while others will invest in expertise and devise more complex, tailor-made solutions, says New Re’s chief executive.
A growing split is emerging in the non-life reinsurance industry between commoditised property-catastrophe business, in particular cat coverages, which is increasingly being targeted by alternative capacity providers, and more complex solutions that require sophisticated risk modelling, expertise and bespoke solutions.
That is the view of Andreas Molck-Ude, chief executive officer of New Reinsurance Company, a member of the Munich Re Group very much focused on offering the latter solutions to clients. He believes reinsurers will increasingly have to choose which camp they wish to be in and adjust their strategy accordingly.
“For many lines of reinsurance the trend is very much towards commoditisation,” he says. “The challenge for traditional reinsurers is how to conduct these transactions as cost-efficiently as possible. It becomes about efficiency and speed.
non-life reinsurance, New Re, alternative cat, Andreas Molck-Ude