Cargo insurers can expect to face a large exposure value after the recent tanker attacks in the Gulf of Oman.
(Re)insurers fear casualty clash exposures
29 August 2016 | Press Article
Published in Insurance Insider
One of the key concerns of (re)insurers in the current market is their inability to quantify the effect of a systemic casualty event on their portfolio, according to the findings of a new survey.
The canvass of (re)insurers in the European and US casualty markets by risk modelling specialist Russell Group revealed that reducing premiums, increasing exposures and connected risks are the main concerns in 2016.
Some 64 percent of casualty underwriters agreed that the soft market is their biggest challenge, with falling premium the biggest fear.
A further 17 percent of casualty underwriters said clashing or connected risks are their biggest worry in such a soft environment.
Portfolio rebalancing (37 percent) and risk selection (37 percent) were considered by nearly three quarters of the survey participants to be the best remedies to counteract the soft market's effects.
Russell Group managing director Suki Basi said: "The survey highlights concerns that are shared by casualty (re)insurers I have been speaking to this year, which is that their class of business is facing a range of exposures that they are unable to name, let alone model.
"Yes, the soft market is the primary concern and understandably so, but increasing exposure and risk accumulation are concerns too."