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Scor ‘substantially immune’ to market: Kessler

With the P&C reinsurance market challenged and cat pricing in free fall, Scor CEO Denis Kessler has argued that his company's business model leaves the reinsurer well placed to ride out the gathering storm.

"We're not immune to market trends, but I think that we're substantially immune [to pricing pressures]," he told The Insurance Insider.

The executive pointed to Scor's unusual business mix, with 55 percent of revenues coming from its life reinsurance business, and observed that only 2.5 percent of the group's total top line comes from US property cat.

Kessler also pointed to Scor's diversified book, not just between life and non-life, but also by product line and geography.

The Scor CEO placed emphasis on the company's "substantial proportional" book of business.

"That means the bulk of what we do is basically direct," Kessler said, referencing the way that underlying rates flow through to reinsurance rates on quota-share business.

Kessler also told The Insurance Insider that moving the tax domicile of the company, which is still seen as part of the French establishment, was not out of the question in the long term.

"It's not something that we're actively working on - there is no project or plan underway to redomicile - but we never say never."

Kessler went on to stress that, despite its perceived status as a French institution, and despite the fact that the group opted for Societas Europaea status in 2005, decisions on the future of the group are always taken purely on business grounds.

"I will do the best for my company. I have no other mandate than to maximise the value of the company. You won't see any flags in my office but we constantly refer to the word 'global' - Scor Global P&C, Scor Global Life, Scor Global Investments," he continued.

"So if there was a time when it made sense for my shareholders - from a tax perspective, from a labour market perspective, from a regulatory perspective - then that is something that we would have to give proper consideration."

However, Kessler stressed that Scor is not unhappy with the status quo. The group currently has a tax rate of around 24 percent, some way short of the French normalised corporate tax rate of 33 percent, owing to its "multi-centred" structure with major tax-paying entities in a range of countries including Ireland, Singapore, the UK, the US and Switzerland.

He said that the 24 percent tax rate struck him as "reasonable" and "in line with international standards".

The Paris-headquartered carrier also retains substantial tax credits from the period before the remarkable turnaround that Kessler has presided over.

Scor is one of a relatively small number of reinsurers with its main tax domicile outside of a low tax jurisdiction like Bermuda and Switzerland.

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