Reinsurers must expand scope of financial services to thrive

Article Abstract:

An increasingly competitive market environment driven by the need for short- term returns on investment is causing reinsurance companies to redefine their ways of doing business and to expand their financial services. Reinsurers connected to the securities markets are diversifying their securities products, resorting to public offerings and making private placements to maximize short-term capital gains. They are also actively defining the role of brokers in seeking out business for them rather than passively waiting for brokers to independently secure reinsurance contracts.

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Reinsurance and managing insurance company risk

Article Abstract:

The financial characteristics and effects of reinsurance make it possible for insurance companies to use mean-variance portfolio models to make reinsurance decisions. Reinsurance as an investment strategy can be used by companies to optimize portfolio capacity, to leverage underwriting results and to convince insurance industry players of its financial prudence. The particular asset-allocation models chosen by insurance companies depend on the aim which they hope to achieve in offering reinsurance.

Investments

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Captive insurers extending reach into new areas; a potential new source of business is emerging for conventional insurers and reinsurers who can tap into self-insureds seeking opportunities in offshore or captive operations

Article Abstract:

The diversification of self-insured insurance companies into captive operations is providing a new area of business opportunity for conventional insurance firms. Captive operations contracting with self-insured companies need traditional carriers to issue coverage to individual companies within their groups. The most promising areas of expansion coverage involve the areas of healthcare insurance and workers' compensation.

Self-insurance, Self insurance

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