Consolidation of the global reinsurance industry will continue, as intense market competition and capital levels drive M&A, while smaller players lacking scale and diversification confront further pressure in regard to growth and profitability, Fitch Ratings says.
Global economic losses from natural catastrophes and man-made disasters in 1H2018 were USD 36 billion, well below the ten-year average of USD 125 billion in economic losses and significantly lower y-o-y. USD 20 billion of the total were covered by insurance, Swiss Re Institute's preliminary sigma estimates show.
FITCH Ratings has revised on 4 September 2018 its outlook for the global reinsurance sector to stable from negative, on the belief that earnings have settled at a "new normal", with return on capital likely to be more modest but less volatile than before.
Global commercial insurance pricing increased for the third consecutive quarter in Q2 2018, largely driven by insurance pricing for property lines, which continued to be affected by 2017 catastrophe losses, and by increases in financial and professional lines, the latest data published by Marsh show.
Five insurance entities are listed among the largest public companies by
their market capitalization in USD as at 31 March 2018, according to
the latest edition of the PwC's Global Top 100: the US domiciled
Berkshire Hathaway, the Chinese Ping An Insurance, China Life Insurance
and AIA Group and the German Allianz.
What we generically call "Cyber risk" is, in fact, a family of risks and
it is worth observing if there is a commonality in the perception -
thus management - of the risk in the academic, risk management,
insurance and policymaking communities. The present study found that
cyber breach is perceived as "critical" due in part to its own nature
and, importantly, in part to the weak understanding of its impact and
Natural disasters across the world caused significantly lower losses in 1H 2018 than usual. According to provisional figures, overall losses were around USD 33 billion, the lowest level since 2005 (USD 29 billion after adjustment for inflation), MUNICH Re said today.
Overall, extreme weather events led to a multi-billion dollar economic toll, of which insurers have to pay more than USD 3 billion in claims for US losses alone, the latest edition of Aon's monthly Global Catastrophe Recap report shows. Economic losses in the Central and South-Eastern Europe amounted some hundred million USD, but weather continued also in July, adding extra costs which may also amount to significant sums.
Global insurance premiums increased 1.5% in real terms1 to
nearly USD 5 trillion in 2017, after rising 2.2% in 2016, the latest
sigma report reads. Growth in both the life and non-life sectors slowed.
According to Swiss Re Institute next years will see the life insurance
segment's premiums improving driven by the strong growth in the emerging
markets, especially China, while the strengthening economy of the US
will lead the non-life global market's development.
Insurance markets of the Middle East and Northern Africa (MENA) are expected to continue outgrowing the region's GDP over the next 12 months. Personal lines business remains the key growth driver, with primary insurers benefiting from compulsory insurance requirements as well as regulatory actions supporting rates, the latest edition of the MENA Insurance Pulse reads.
Four of the Top 5 global M&A deals, in the financial sector in 2017, totalizing USD 28.8 billion, occurred on the insurance sector's stage. The absolute star of the season was the acquisition of the US based XL Group's by the French AXA, for a total consideration of USD 15.26 billion.
Complying to the EU General Data Protection Regulation (GDPR), effective from 25 of May 2018, is currently one of the most challenging issues for many organizations. Even in the absence of a personal data breach incident, companies may face regulatory assessments resulting in fines and penalties. Moreover, companies operating on several territories, including the EU, may encounter situations interesting several jurisdictions with different legislation. How much can insurance help organization to manage this kind of operational risks?
Man-made risks like cyber-crime, interstate conflicts or market crashes are a bigger threat to economic output than natural disasters, putting an estimated USD 320.1 billion of global GDP at risk on average each year, according to Lloyd's City Risk Index. Built in collaboration with Cambridge University, the study measures the impact of 22 threats on 279 cities' projected economic output.