June 2011/3

Collateralised reinsurer Aeolus Capital Management has raised more than $500mn to invest in the mid-year renewals as its private equity owners back out of the business, sister publication Trading Risk has reported.

Despite a reported increase in property cat pricing, a well-capitalised traditional reinsurance market has been sufficiently competitive to take market share from the insurance-linked securities (ILS) sector in the mid-year renewals season.

Mark McComiskey, managing director of private equity firm First Reserve, is surprised by the frenzy of interest in new sidecar initiatives following the roll-call of major cat losses over the past 16 months.

(Re)insurers are actively lining up a broad range of sidecar-style structures to deploy if a significant catastrophe accelerates the hardening of property cat rates later this year.

US insurers have reported more than $4.5bn in catastrophe losses for only the first two months of the second quarter.

Japanese non-life insurers have now paid out 944bn yen ($11.8bn) relating to homes damaged by the 11 March earthquake, the General Insurance Association of Japan said last week (10 June).

Small Lloyd's insurance broker Swinglehurst is anxiously awaiting the receipt of £3mn of overdue fees from a single client, as it seeks to settle a £920,000 tax dispute with the UK tax authorities (HMRC) that has driven it to the brink of bankruptcy.

Preference share issuances are gaining in popularity as (re)insurers raise new funds to take advantage of hardening property cat rates without diluting their existing shareholders.

International P&C insurer RSA has set out a vision for meeting the world's energy needs using renewable energy sources only as the sector continues to provide an attractive growth opportunity for insurers.

The brutal roll-call of energy losses in 2010-11 inevitably hammered Torus' loss ratios, but has not dented the group's long-term view of the opportunities in the energy and other specialty markets.

Risk managers in the energy industry are "not happy" with the way insurers have responded to the landscape post-Macondo and there is a danger that they will become disaffected, the chairman of Gallagher International has warned.

The cost of political violence cover is set to increase by 5 to 10 percent because of the unrest that has spread throughout the Middle East.