Today’s challenges: a bevy of grey swans

The challenges reinsurers are facing should not be termed a black swan situation since all were foreseeable—but it might fairly be described as a confluence of grey swans, David Flandro (pictured), head of analytics at Howden, told Intelligent Insurer.

He said none of the trials facing the industry is unique, unexpected or something that has not been seen before. But the fact that so many have hit the industry simultaneously is unprecedented—and will make for one of the toughest renewals in at least 10 years.

“This renewal is completely different from anything we have seen in the past decade, including last year, which was also challenging,” Flandro said. “It is the first time since the financial crisis that we may well see reinsurance capital actually shrink.”

He lists the many issues reinsurers are grappling with, many of which were unexpected—but not unforeseeable.