Unfortunately for reinsurers, the catastrophe losses of 2017 are happening at a time when profitability in non-catastrophe lines is constrained and prior-year reserve releases are slowing, the report said.

For buyers, the shape of the global reinsurance industry in 2017 was significantly different to those previous years, with traditional reinsurers remaining strongly regulated and capitalized supplemented by Insurance-Linked Securities (ILS) capacity, which has grown to $75 billion.

According to the report, the ILS market showed resilience during the catastrophe losses in the second half of the year, comfortably weathering the first major test for a number of funds with investors prepared to recapitalize funds and provide liquidity for trapped capital.

James Kent, Global CEO of Willis Re, said: “No commentary on the January 1 renewal season can overlook the scale of human suffering and economic loss that the catastrophes in the second half year of 2017 have caused.

“The global reinsurance industry is central to alleviating the impact of the 2017 hurricane losses.”

Bradley Kading said the provisions in new tax laws that discriminate against foreign reinsurers could potentially start a trade war between the U.S. and the European Union.

The new reforms in the U.S. will reduce the U.S. corporate tax rate to 21% from 35%, The Royal Gazette reported, quoting Mr. Kading as saying that it will “levy a base erosion anti-abuse tax on affiliated reinsurance business, will have an “individualised” impact among Abir members.”

“The bigger picture is that this U.S. tax law is an example of growing protectionism around the world,” Mr Kading said.

“If you are a global reinsurer and your business model is to pool global risk on one balance sheet to get the benefits of diversification, then protectionism, in the form of regulation or tax provisions, is dangerous.”

The subsidiary will reinsure 50% of certain U.S. workers’ compensation and asbestos, pollution and toxic tort business and provide consulting services with respect to the entire $200 million portfolio.

Dominic Silvester, Enstar Chief Executive Officer, said: “In 2016, we partnered with Allianz SE to provide reinsurance solutions for legacy portfolios.

“We are pleased to continue building our relationship with Allianz SE by entering into another transaction that aligns with our core competencies and growth strategy.”

The business taken on by Enstar’s subsidiary was originally assumed by San Francisco Reinsurance Company.

Many anticipated that Solvency II would bring a greater focus on legacy business for European insurers and reinsurers, Reinsurance News said.

However, many companies have prioritised other regulatory and legislative demands such as the Insurance Distribution Directive, new anti-money laundering requirements and the impending General Data Protection Regulations.

“Many re/insurers in continental Europe have a sizeable number of contracts in run-off,” Clyde & Co said.

“Management of this business is quite demanding in terms of the specific expertise it requires, as well as the demands it places on capital, immobilising funds and resources that could be used elsewhere.”

“Overall, the size of the European run-off market is estimated to be around €247 billion ($294.6 billion) of which France and the Benelux countries account for €41 billion ($49.4 billion), according to PwC.