"As of January 2015 renewals, capacity provided to the region increased, both with new players trying to penetrate and existing players increasing their appetite. On the other hand, international reinsurance capacity need of the region decreased due to the increase in the capacity provided by group reinsurance companies to their group insurance companies, which stimulated a very soft market in the region," explained Alexandre BICHOT, Deputy Head of Department Foreign Inward Business, Russia, CIS, CEE, and Africa.
Moreover, the implementation of the Solvency II regime brings into debate a new series of problems. Alexandre BICHOT explained that "most countries in the region are getting ready to implement Solvency II regime in the near future. The standards set in the regime in respect of capital are expected to affect some companies, especially the smaller ones."
Moreover, the negative results of the Motor Insurance market continue to have a negative impact. "Motor insurance which is producing historically negative results due to very low rate increases being insufficient to compensate high frequency of Motor losses continues to be dominant in the portfolio of the insurance companies and therefore contributes to negatively impact financial results", MILLI Re's representative stated.
Overall, "expectations for the CEE reinsurance market are to remain competitive and soft in the near future", Alexandre BICHOT added.
As far as the Romanian market is concerned, MILLI Re's plans involve the expansion of its activities through new partnerships.
"We are currently working with 4 companies in the Romanian Market on treaty basis (as we are a treaty reinsurer). Our essential objective would be to add new partners to our portfolio as well as increasing our shares in our participations. We have still a considerable amount of capacity for the Romanian Market that is not used. Our target is to use this available capacity. Our main aim of focus is the classical lines such as Fire, Engineering and Marine", Alexandre BICHOT explained.
MILLI Re is a Strategic Partner of FIAR - International Forum Insurance-Reinsurance, which takes place in Brasov, at Hotel Aro, between 17th and 21st of May 2015. More information about the event and details on how to register are available on www.fiar.ro.