An Intermediary's View of the Reinsurance Market
Article Abstract:
The reinsurance industry is in the middle phase of reevaluation and price tightening cycle that should peak at the end of 1984. New regulations, such as New York Regulation 98, will limit the reinsurance market by demanding more careful investigations of the houses assuming reinsurance. This may have a more limiting effect than pure underwriting considerations. Pro rata arrangements have been the most greatly disrupted. Ceding commissions often exceed underwriting profits. Reinsurers are unwilling to write unprofitable risks. The capacity problem can be adequately serviced through the excess of loss reinsurance. Faculative insurance capacity will be small by year end as reinsurers retreat. Further regulation of the reinsurance industry could impede its growth. Restraint must be exercised not to regulate in this tight market.
Publication Name: Best's Review Property-Casualty Insurance Edition
Subject: Insurance
ISSN: 0005-9714
Year: 1984
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Captives as a comp cure
Article Abstract:
Captive reinsurance companies provide alternatives to the high cost of state workers' compensation systems. Captives are similar to self-insurance but with a twist. The business purchases the policy from the insurance company; then the policy is reinsured by the insurance company with the businesses' captive reinsurance company. Group or mixed group captives allow more than one company to consolidate finances and share in the total risk. Captives have been effective in reducing loss ratios to between 15% and 20% below California state averages for Claremont Holdings, a captive reinsurance group composed of 21 different businesses in California.
Publication Name: Best's Review Property-Casualty Insurance Edition
Subject: Insurance
ISSN: 0005-9714
Year: 1993
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Reinsurance at the Crossroads
Article Abstract:
Changes in reinsurance call for difficult decisions. Regulation of reinsurance is increasing. Lloyd's of London is a case in point of regulatory increases. Despite the closeness of reinsurance and direct insurance conflict does exist. Market structure is a consideration. International competition has increased. A considerable number of reinsurers have either reduced or given up their involvement in the market.
Publication Name: Best's Review Property-Casualty Insurance Edition
Subject: Insurance
ISSN: 0005-9714
Year: 1983
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