Seeking Alpha

Report: Reinsurers face big premium slide

  • Following a 2013 in which the number of natural and man-made disasters fell by half, reinsurers could be hit with up to a 25% decline in premium revenue this year, according to broker Willis Re.
  • Combining with the lack of catastrophes is a market in oversupply as pension funds and hedge funds (like GLRE and TPRE) rush into the business - a $50B increase in industry capital, says Willis CEO John Cavanagh.
  • U.S. property casualty reinsurance faces the biggest hit - 10-25% - while European premiums could fall 10-15%.
  • Hannover Re (HVRRY) last week said it expected premiums to fall this year, fueling concern about a price war with competitors like Swiss Re (SSREY) and Berkshire Hathaway (BRK.A, BRK.B).
  • Among U.S. reinsurers: ACE, XL, PRE, RE, RNR.
Comments (0)
Be the first to comment
DJIA (DIA) S&P 500 (SPY)
ETF Tools
Find the right ETFs for your portfolio:
Seeking Alpha's new ETF Hub
ETF Investment Guide:
Table of Contents | One Page Summary
Read about different ETF Asset Classes:
ETF Selector