Daily Insurance Industry News
Daily Insurance Industry News
Friday 23rd of March 2018
November 25, 2008

Munich Re reports rise in reinsurance demand

by Gill Montia

Story link: Munich Re reports rise in reinsurance demand

Munich Re is expecting the financial crisis to increase demand for reinsurance, as lower investment returns put pressure on primary insurers’ capital positions.

With capital strength challenged by market volatility, the industry is finding it increasingly difficult to support high risk exposure and the group has reported a swift increase in demand for reinsurance, as primary insurers feel the need to move risk away from their books.

Speaking in Hong Kong at the East Asian Insurance Congress, Ludger Arnoldussen, a member of Munich Re’s board of management, said he expects the change to benefiting strongly placed reinsurers such as Munich Re.

The group’s capital base as at 30 September 2008 totalled €21.5 billion having held steady on the first six months of the year, despite the global financial turmoil.

Speaking of the future, Mr Arnoldussen explained that while Munich Re cannot fully escape the wider effects of the crisis the company should emerge strengthened because it will benefit from rising reinsurance premiums, the expansion of profitable business and opportunities for acquisitions.

The reinsurer also says it will continue to focus on organic growth in Asia and Australasia, regions that accounted for around 10% of its reinsurance premium volume during 2007.


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