APRIL 03, 2020 09:05 AM (EDT)
Best’s Commentary: Global Reinsurers Resilient in Face of COVID-19-Related Adversity
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Michael Porcelli, FSA
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FOR IMMEDIATE RELEASE
OLDWICK - APRIL 03, 2020 09:05 AM (EDT)
While AM Best views the global reinsurance segment as well-positioned to withstand setbacks due to the COVID-19 outbreak, it should be noted that the adverse underwriting- and investment-related impacts may restrain capacity and further support pricing momentum.
A new Best’s Commentary, “Global Reinsurers Resilient in Face of Adversity,” notes that although the global pandemic has caused short-term disruption in business, reinsurers, brokers and most cedants appear to have the necessary technology infrastructure to maintain business operations. From an operational perspective, the upcoming April and June renewals should proceed as usual. While the industry was already under considerable pressure to increase rates following three consecutive years of losses, pricing during these upcoming renewals, particularly in June, also could be influenced by capacity tightening from third-party capital, as investors are pressured by collateral and margin requirements owing to the volatile markets.
The commentary also highlights potential impacts on each segment of the industry, including:
To access the full copy of this commentary, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=295965 .
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in New York, London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.