Reinsurance Market Turning

It seems like just yesterday we blogged on the round of reinsurance market commentaries released to coincide with the Monte Carlo September Rendezvous (see our September 10 posting). Back then many reinsurers were reticent to speak of actual price increases. More than six weeks on, and the word on the street is that reinsurance executives gathered at the Baden-Baden 2008 Reinsurance Symposium are more forthright. The impact of the financial crisis is increasing both the demand for and price of reinsurance. In a press release issued at Baden-Baden, Munich Re noted that since Monte Carlo the world’s 10 biggest insurers in terms of market capitalization have lost more than a quarter of their market value. This is increasing the significance of reinsurance as a direct capital substitute. In view of the increased cost of capital, growing demand and the changed risk environment, Munich Re said it expects significantly higher prices, with increases definitely in the double-digit range. For more on this story check out today’s Reuters article by Jonathan Gould and Arno Schuetze. Check out further I.I.I. information on reinsurance.  

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