The alterative sources of capital, which are used for taking over natural catastrophes risks, have already become one of the most discussed subjects during the Monte Carlo meeting. At the moment, this topic has created two separate sides: brokers such as AON Benfield or WILLIS argue that such investments will exponentially increase in the following years, while the large reinsurers, such as SWISS Re and MUNICH Re, are only slightly influenced by them.

The reason is simple: these investors' reaction to a large natural catastrophic event (which would trigger Cat Bonds) is extremely difficult to anticipate.

According to Matthias WEBER, Chief Group Underwriter, SWISS Re, these financial instruments are tempting for the moment, given the fact that no catastrophic events of large magnitude have taken place recently. On the other hand, the moment of truth for those outside the industry that are willing to take such chances will be when "the hammer strikes".

A similar opinion is shared by Torsten JEWORREK, member of the Board, MUNICH Re, who declared that the "investors' reaction is difficult to anticipate in the absence of natural catastrophes."

At the same time, the reinsurers do not feel threatened by a competition between them, on the one hand, and the pensions and hedging funds, on the other hand, because their business model consists of more than risk-covering. Besides the reinsurance capacity, the reinsurance companies offer consultancy, know-how, training programs and personalized solutions, sustained by their long history and vast experience. Another significant difference is the fact that reinsurers have a very long term business.

"Speculating on the NatCat segment is like reading the future in a crystal ball. You can have multiple hurricanes that bypass the land, but only one that strikes a large city is enough", Torsten JEWORREK explained.

However, all specialists agreed that a new infusion of capital will create new opportunities for reinsurers, such as the public-private partnerships or the development of flood-protection programs, investments in nanotechnology, energy or space industry.

During this year's edition of "Les Rendez-Vous de Septembre", Media XPRIMM was represented in Monte Carlo by Alexandru CIUNCAN, Managing Partner, Vlad PANCIU, Strategy&Development Director, CEE&CIS, and Mihai CRACEA, Editor in Chief, XPRIMM Publications.