The abundance of alternative capacity that has entered the reinsurance industry in recent years will stay and may well prove of significant benefit to buyers.
That was the view of Stephen Hearn, chairman and CEO of Willis Global, speaking at Airmic’s annual conference in Brighton, UK, who also dismissed suggestions that third party capital might prove a fair weather friend.
His view was echoed by others on the panel. Steve McGill, chairman and CEO of Aon Risk Solutions, said that, far from being destructive, cash from capital market institutions has the potential to bring long-term capacity to the market. Instead, he said the issue will be in finding enough opportunities to satisfy demand.
This may not be what reinsurers want to hear and the panel also suggested primary players may be next to find themselves competing directly with the capital markets.
Thomas Hurlimann, CEO of Zurich Global Corporate, said that with reinsurers increasingly involving themselves in insurance, it was likely that third party capital might begin to express a similar interest.