Mutual insurers have found themselves in a prime position to capitalize on changes in the traditional reinsurance market, according to Willis Re, the reinsurance broking arm of Willis Group Holdings.
Its newly released “1st View April 2013 Renewals Report” “found that changing distribution models coupled with a flood of alternative capital has left many reinsurers concerned over both their existing portfolios and their access to future growth.”
As a result mutual insurers are being provided “with the perfect opportunity to strengthen their existing relationships with traditional reinsurers and to forge new ones.”
Robin Swindell, Executive Vice President of Willis Re, explained: “Traditional reinsurers are very aware that while some larger commercial buyers are reducing their use of reinsurance in this phase of the reinsurance cycle, mutual buyers value long-term sustainable relationships throughout the entire cycle. This is the perfect time for mutuals to demonstrate that they are reinsurers’ preferred customers.”
Willis Re noted: “Mutual insurers have a unique ownership structure where policyholders, not external shareholders, are the ultimate owners. This means they have less access to other forms of capital, and as a result, mutual insurers are often heavily reliant on reinsurance to provide them with additional capital to deal with catastrophes and large losses.”
John Haydon, Executive Vice President of Willis Re, added: “Mutual insurers are in business for their members for the long-term and should receive the recognition they deserve from reinsurers. Like mutuals themselves, reinsurers should never leave their loyal customers in the lurch.”
Willis Re’s CEO John Cavanagh commented: “Seismic changes occurring in the traditional reinsurance market are clearly favorable for mutual insurers. Willis Re has always been a strong advocate of the long-term business models characterized by mutual insurers, and will continue to provide analytical and transactional support to our clients in this important market.”
Source: Willis Re
Was this article valuable?
Here are more articles you may enjoy.
Allstate Reports $731M in Q1 Pretax Catastrophe Losses 
Progressive Gains as Drivers Shop Around for Auto Insurance—Again 
AIG General Insurance Chairman McElroy to Retire May 1 
Jury Awards $80M to 3 Former Zurich NA Employees for Wrongful Termination 
