Best’s Briefing: U.S. Life Reinsurance Market Outlook Remains Stable
The Best’s Briefing, titled, “Market Segment Outlook:
The wave of consolidation that occurred over the past decade has run its course, leaving five dominant players that control of four-fifths of assumed life premium for the industry. Four of the five largest
These life reinsurers are generally where direct writers look first to place business due to their large highly rated balance sheets, strong treaty and facultative capabilities, and the ability to customize solutions to help companies optimize their capital management strategies. The
However, there does continue to be interest by new entrants, but their business models are primarily focused on asset accumulation as opposed to mortality. Such companies are often backed by investment managers with expertise in certain asset classes and have a greater risk appetite. Their business models are predicated on offering attractive prices to buy annuity business. Cedants, though, may not be comfortable with more aggressive investment strategies because in case of insolvency, business and the assets in support of that business may revert back. While there is a potential for such companies to acquire significant assets, their focus is not life reinsurance, and thus
For the full copy of this briefing, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=269392.
A video interview with
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