Source: Business Insurance

September 09, 2019 Robert De Rose, senior director at U.S. credit rating agency A.M. Best Co., said that the global reinsurance sector needs systemic changes in order to survive in the long run, Asia Insurance Review reports. The main impediments facing the sector include intense competition, excess capacity, potential for increased inflation, less cushion in carried loss reserves and continued interest from third-party capital.

Source: Business Insurance
September 09, 2019 Paul Schultz, chief executive at Aon Securities, expects “very strong” pick up in catastrophe bond issuances, Artemis reported. As the insurance-linked securities market and reinsurance recover from losses, cat bond issuance is set to make a comeback in larger volumes, Mr. Schultz added.

Source: Business Insurance

September 09, 2019 Swedish clothing brand Hennes & Mauritz AB has stopped purchasing leather from Brazil due to environmental concerns highlighted by Amazon wildfires, Business Standard reports citing Reuters. Additionally, U.S.-based fashion products maker VF Corp. recently banned Brazilian leather due to Amazon wildfires.

Source: Business Insurance

September 09, 2019 Technology leaders in Asia have warned that the U.S.-China trade war threatens to fracture the global supply chain, Abacus News reports citing Bloomberg. The harsher business environment is also pushing tech companies on both sides to re-evaluate their operations, giving rise to a splintering of supply chains.

Source: Business Insurance

September 09, 2019 (Reuters) — China’s banking and insurance regulator on Monday capped how much insurance firms can invest in their shareholders, aiming to curb risks linked to the misuse of financial resources. China is sharpening its scrutiny of insurers’ and small banks’ shareholders amid fears that loans and investment given to big investors could prove a weak point in the country’s financial system. Under the revised rules, which took effect on Monday, an insurance company’s combined investments in its shareholders or their related parties must not exceed 30% of the insurer’s total assets or net assets in the previous year, the CBIRC said. An insurer’s investment in any single shareholder is capped at 15% of the insurance firm’s total assets, the regulator said, under the new rules which aim to improve corporate governance in the sector. The board of each insurer will also have to set up a committee to routinely control and assess the risks of related transactions, according to the revised regulations. In February last year, Anbang Insurance Group Co., once among China’s most aggressive overseas dealmakers, was seized by the state. In May 2018, ex-chairman Wu Xiaohui was found guilty of fraud and embezzlement and sentenced to 18 years in prison.

Source: Business Insurance

Claire Wilkinson September 09, 2019 The global modeled insured average annual loss from catastrophes worldwide is now around $92 billion, up 55% since 2012, according to a report issued Monday by AIR Worldwide Corp. At nearly $288 billion, the 100-year return period loss, or the 1% aggregate exceedance probability insured loss, is also more than double the record losses seen in 2017 from Hurricanes Harvey, Irma, Maria and other natural catastrophes, the Boston-based catastrophe modeling firm said in the report. The increases reflect both rising numbers and values of insured properties in areas of high hazard and includes regions and perils where new models are now available, AIR said in the report. “There is still much of 2019 left, leaving open the possibility that a natural catastrophe could cause significant insured losses,” AIR said in the report. In 2018, the top three insured losses globally were caused by events that occurred after Sept. 1, including the Camp Fire in California, Hurricane Michael and Typhoon Jebi, AIR said. Companies operating on a world stage need to understand their risk across global exposures to ensure they have enough capital to survive years of very high loss, the report said.

Source: Business Insurance

September 05, 2019 Catastrophe bond issuance dropped 44.3% to $5.42 billion for the year ended June 30, compared with a year ago, according to a report Thursday from Aon Securities.ILS capital in place declined to $93 billion at June 30 from $98 billion a year ago, the report said.

Source: Business Insurance

September 06, 2019 Oman Air has cancelled more than 300 flight services because of the ongoing suspension of the Boeing 737 Max aircraft, Mathrubhumi reported. Flights to Kozhikode, Mumbai, Bengaluru, Hyderabad, Dubai, Bahrain, Salalah, Doha, Amman and Karachi have been cancelled until Oct. 1. Earlier, the airline cancelled services to major cities from July 7 until the end of August.

Source: Business Insurance

September 06, 2019

Stephen Catlin, chief executive of U.K.-based insurer and reinsurer Convex Group Ltd., said that firming of insurance and reinsurance rates could persist for the “next three to four years,” Artemis reported. “Prices are nothing like what they were and a lot is still underpriced.” Mr. Catlin believes that following heavy catastrophe losses in recent years, the likelihood of rapid insurance-linked securities market growth is much lower.