New capital will settle cycles
Additional third party capital should be welcomed as it will help to reduce extreme market cycles. That is the view of Philippe Regazzoni, CEO of Amlin Re Europe.
“There are very mixed opinions on this, however, we think that the additional capital is here to stay – it's a good investor rationale for these products and could help to steady extreme market cycles,” said Regazzoni.
“It's a genuine complementary investment product that is sustainable and an extremely interesting alternative for investors looking to access the insurance market without having to access all the other operations and risks that are attached.”
Regazzoni continued: “The offering is totally different from the offering of a traditional product. It has a specific space to play in which traditional markets can't serve efficiently.
“It is interesting for reinsurers and clients and should help to reduce the extremity of market cycles,” he said.
“Finding the right way to cooperate with it and making it work for our business model, while differentiating ourselves from the competition is the next challenge.
Regazzoni also explained that the additional capital is “forcing businesses to think about how they can bring a different service to clients”, which he describes as “a good thing”.
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