90% of IIS delegates anticipate consolidation

Almost 90 percent of attendees at the International Insurance Society’s annual conference anticipate a period of consolidation for the reinsurance industry, based on a live poll held at the event in London yesterday (Tuesday June 24).

Some 35 percent of attendees anticipate substantial consolidation while 53 percent said they expect some consolidation. Only 12 percent said they do not expect much mergers and acquisition activity going forward.

Vincent Vandendael, director of international markets at Lloyd’s, noted that some 20 percent of the capacity in Lloyd’s has changed hands in some shape or form in recent years and he expects this to continue.

Denis Kessler, chief executive of SCOR, outlined a number of factors he believes will drive consolidation. These include increasing competition from capital markets money on some lines of business and increased regulatory measures growing the fixed costs of compliance required by reinsurers.

He added, however, that he did not expect companies to take any risks in the process of exploring potential mergers and acquisitions. “Almost all boards are more cautious than they have ever been but I still anticipate a number of deals.”