March 2015/4

Share price data on The Insurance Insider's universe of P&C (re)insurers

Shares of the publicly listed carriers in our Insider 30 composite underperformed the FTSE100 last week, with their stocks rising just 1.44 percent on average.

The UK Prudential Regulation Authority (PRA) has explained that the chief actuary should form the "second line of defence" in its impending senior insurance managers regime.

The passage of the Indian insurance bill is set to significantly open up the country's insurance sector, as foreign reinsurers look to establish onshore branches.

UK-based (re)insurers are awaiting further clarification on the proposed diverted profits tax, after Chancellor of the Exchequer George Osborne confirmed the so-called "Google tax" would come into force from 1 April.

David Whiting, a former senior casualty underwriter for Torus, has been awarded just $1,909 of the almost half-a-million dollars he asked for in a constructive dismissal claim against his old firm.

A high court judge has criticised British Telecom (BT)'s insurers for trying to reduce claimant solicitors' fees in settlements of industrial deafness claims.

Ace has appealed against a ruling that made it liable to pay out under the pollution clause of a property policy, following a fire at a chemical plant in 2011.

Last week's proxy filing also gave some insight into how PartnerRe and Axis were valued during the due diligence process.

Global bankers Credit Suisse and Goldman Sachs are set to collect combined transaction fees of up to $49.5mn for financial advisory services if the proposed deal between PartnerRe and Axis successfully completes.

Axis-PartnerRe will achieve a double-digit return on equity (RoE) after two full years of operation, despite shrinking industry returns, according to Goldman Sachs' investment banking arm.

The year-end investment results of The Insurance Insider's composites clearly showed the challenging year the industry's CIOs faced in 2014.

With 2014 now behind us, The Insurance Insider takes a look at the possible outcomes in the upcoming first quarter results season...

Amid limited growth opportunities (re)insurers handed back more capital in 2014 in a bid to create shareholder value and boost returns, as the wheels of M&A were finally set in motion.

Global (re)insurers once again led the way on investment yields in full-year 2014, although returns remained subdued.

(Re)insurers in our listed P&C universe generally delivered lower returns in 2014 as thinning underwriting margins and anaemic investment returns hit profitability.

Although (re)insurers gained some respite from the lack of major cat losses last year, there was evidence of weakening underwriting performance as carriers faced a variety of other headwinds such as rising expenses and expanding accident year, ex-cat loss ratios.

The rate of premium growth decelerated for most of the companies in our P&C universe in 2014 as carriers faced fierce competition, softening reinsurance pricing and stagnant demand for risk transfer, forcing them to revise their growth strategies.

Risk carriers faced a challenging 2014 as they adapted to a new market paradigm, with the effects starting to become apparent in their results.

The pace of cat bond issuance has picked up as the end of the first quarter comes into sight, with a number of sponsors bringing out new deals in the past week.

Tokio Marine expanded its new Kizuna Re II cat bond from an initial target of 25bn yen ($207mn) to 35bn yen ($290mn), as the ultra low-risk deal was oversubscribed by insurance-linked securities (ILS) investors, sister publication Trading Risk reported.

Private reinsurers appear unlikely to directly benefit from Heritage P&C's decision to reduce the coverage it buys from the Florida cat fund, with the majority of limit largely replaced by a new cat bond instead.

Tropical Cyclone Nathan is expected to strengthen to a severe Category 3 storm before making its third landfall in northern Australia early this week, according to the Australian Bureau of Meteorology.

QBE Europe has continued to expand its presence in the UK solicitors' professional indemnity (PI) market, increasing its share by almost 10 percent at the latest renewal.