Munich Re: Reinsurers should focus on innovation and cycle management

Reinsurers should not be worrying about if and when the soft market will end—instead they should be focused on innovation and cycle management during the prolonged downturn, Torsten Jeworrek, member of the Board of Management at Munich Re, tells Intelligent Insurer.

“Pricing cycles have become less volatile and pricing developments differ in the various regions and lines of business,” Jeworrek said. “But, of course, the overall available capacity and the capitalisation of the market players have an influence on the rates.

“Prudent cycle management is key to keeping the profitability of a portfolio. I do not expect the market environment to change significantly in the coming renewal round, unless extraordinary loss events occur or there are other major market upheavals," he said.

Jeworrek believes the industry should worry more about how it will cope with future risks and the increasingly complex demands of a digitised world. Adaptability and innovation are now crucial for the industry, which must embrace digitisation and new technologies, he said.

“Large amounts of previously not available data and sophisticated analysis methods will improve risk assessment, loss prevention and claims handling,” he says. “Customer expectations and behaviour will change regarding product design, services and sales. These innovation trends mean growth opportunities but also challenges for the insurance industry.”

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