MS Re eyes offering structuring products to clients
MS Reinsurance is open to working with its clients on structured products that could help them smooth volatility. But it will be selective on the clients it works with on such a solution, mirroring its more general client-centric approach.
That is according to Jörg Bruniecki (pictured), chief underwriting officer, international business, at MS Reinsurance. He told Intelligent Insurer that, as clients increasingly grapple with volatility on the asset side of their books, it makes sense to help them smooth volatility on the underwriting side.
“It is a question of whether there are structured solutions to offer that could help,” he said. “But it would only be for the right clients.”
That cuts to the heart of his current philosophy. He says that for all the talk around rates increases and changes to terms and conditions, although it’s very much needed, there is less focus on how best to compete as a reinsurer. This, he said, now crystallises MS Reinsurance’s strategy.
“We need to consider what value reinsurers can truly offer, and how we compete,” Bruniecki said. “To me, that means doing three things right. First, understand your clients’ needs and strategy. Second, be easy to do business with—that means allowing underwriters to make decisions.
“Finally, be nimble—keep your cost base down and be competitive.”
Few reinsurers, he argues, do these three things well. He believes MS Reinsurance would feature in the top quartile based on these measures. “We are invested in what clients are really looking for,” he said.
This means forming deep relationships with clients. On the international side, MS Re works with clients that can offer it a balanced portfolio. It is strong in risks such as engineering, agricultural risks and has a substantial international casualty book. Just 10 percent of its book is property-cat, and only where it supports existing clients.
In casualty in particular, he says, a correction is still needed, potentially to the same extent as occurred in property last year.
“Until recently, people saw casualty as a nice diversifier. There was a lot of supply. But results are showing a different story. Some US firms have had to bolster reserves. A correction is now needed in that space, and that means looking at rates and commission levels,” he explained.
Overall, he says, MS Reinsurance is in a good place. Because it works only with clients on a multifaceted way, its portfolio reflects this approach.
“We want to be a long-term partner and leverage those deep relationships in way that benefits both parties,” he concluded.
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