AON BENFIELD: Global reinsurance capital hits new record

12 January 2017 — Vlad BOLDIJAR
According to the "January 2017 Reinsurance Market Outlook" released by the reinsurance broker AON BENFIELD, the estimated value for the reinsurance industry capital rose by 5.3% to a new high of USD 595 billion at the end of September 2016 (vs. USD 565 billion in FY 2015). " Overall demand increased for the industry, but growth has been isolated to few regions and lines of business", AON BENFIELD pointed out in the study.

"While growth in new lines such as mortgage and cyber also continues, slow insurance growth in many regions with low primary insurance penetration saw stable reinsurance demand. Importantly, further evidence of insurer appetite for growth is surfacing in the form of investments in innovative insurer technologies in both organic and inorganic forms".


Traditional reinsurance capital increased by 4.7% over the nine months to September 30th, 2016 to USD 517 billion, amounting to approximately 87% of total reinsurance capacity, "driven by solid reinsurer earnings and unrealized gains on bond portfolios resulting from declines in interest rates".

At the same time, alternative reinsurance capital makes up USD 78 billion, or roughly 13%, which translates to growth of 9.6% over the nine months to September 30th, 2016, " the smallest growth it has reported in 5 years. This result further suggest that traditional capacity is using all the tools at its disposal in order to stave off market share growth from alternative capital".

Click here to read the full study.

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