1 / 14

Reaching New Heights: Ceding Company Perspective

Discover the motivation for buying reinsurance, the importance of relationships, and strategies for meeting regulatory requirements. Learn about possible reinsurance structures and how to reduce risk while stabilizing loss ratios. Gain insights into rating agency concerns, capacity, and the benefits of value-added services. Education, tradeoffs, data, and reaching new heights in the market are explored.

ariley
Download Presentation

Reaching New Heights: Ceding Company Perspective

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Ceding Company Perspective Reaching new heights

  2. Contents • Motivation for buying • Structures • Relationships matter • Increased Expectations of Brokers • Educating Internal Constituents • Tradeoffs • Data

  3. Motivation For Buying • Reduce Risk of Ruin • Stabilization of LR • Meet regulatory Requirements • Rating Agency Concerns • Large line capacity • UW help • Product/price • Audits • Feedback on certain classes of business or new states • Training • Claims help on large losses • Financing (Surplus relief)

  4. Possible Reinsurance Structure • Property Catastrophe • Working Layer • Umbrella • Fac • Quota Share • Aggregate Stop-Loss

  5. Relationships Matter • Better advice and service from intermediaries if they know you well. • Pay more for “carve out” if “value-added” services are worth it. • Property Cat, Working Layer Negotiations • Pricing differentials - important • Capacity (next hard market) - priceless!

  6. Carving out… Better to include umbrella in casualty/clash treaty, or carve out? • Save $ this year? • Risk “mucking up” experience rating on your casualty treaty? • Value-added services? • Balance relationships? • How soft is the market currently?

  7. Carve out Umbrella? What if your umbrella reinsurer provided… • Great sounding board for UW’s on day-to-day account discussions • Help with UW audits • Training sessions for new underwriters • “Advanced Topic” training • Speakers for UW Conference • Research for new state expansion Would you still want to put your umbrella in your casualty treaty?

  8. Relationships Matter Words are easy, like the wind; Faithful friends are hard to find. - William Shakespeare

  9. What we look for in a broker “Any chimp can place reinsurance”

  10. Increased Broker Expectations • Cat, Terrorism, WC modeling • Rating agency advisory • ERM • Contract wording • Claims • Market Security analysis • Competitive intelligence / Research • Expansion ideas

  11. Need to Educate • How involved is Sr. Management and/or the Board? • Risk of ceding too much • Cede too much profit to avoid volatility • In reinsurers’ (and brokers’) best interest to share worst case scenarios since reinsurance is a “fear-based buy” • Risk of not ceding enough

  12. Tradeoffs • “Don’t cede too much of our profit, but smooth out the volatility.” • “We want higher rated markets on our program…but don’t want to pay more.”

  13. Data "Everything should be made as simple as possible, but not simpler." -- Albert Einstein • What companies hope reinsurance u/w’s remember: • Ask good questions to assess our true risks, but... • Differentiate between different types of companies. • Give my companies’ experience enough weight. • Understand the law of diminishing returns. • Use common sense.

  14. Thank you - End Slide Reaching new heights

More Related