The recent re-domestication of several reinsurers to Switzerland will be beneficial to the European market says Philippe Regazzoni, chief executive of Amlin Re Europe.
“The recent re-domestications to Switzerland will have an impact on business in Europe, not the fact that the companies have a legal domicile in Switzerland as such, but the fact that they are under European regulations; European companies prefer to work with companies that are regulated in Europe.”
Regazzoni, who was surprised to see further re-domestications to Switzerland this year, says that more companies could now be looking to move into Europe.
“Last year I thought that there wouldn't be any more moves, however, there have been two more this year – so there may well be more.
“If done properly, with a committed European operation that has clear strategy and continuity plans in place, these operations will help to build relationships with clients and have a positive impact on the service offered in Europe. Reinsurers can better understand the needs of their European clients if they too are based in the region.”
The European market was hit hard earlier in the year with unexpected losses from flood and hailstorms but, as Regazzoni explains, the losses will not have a dramatic impact on the industry.
“Flood losses are always expected – reinsurance is here to pay losses after all,” he said. “This year's floods in Europe were within expectation, however, the size of the hail losses were a bit more unexpected.
“For Germany specifically, it was quite a sizeable loss, so it will certainly see some pressure for increased rates, however, the European market is not that volatile and we don't expect that to change much.
“Overall, there will be some upwards pricing pressure in the casualty lines, which is a little reduced as interest rates have risen slightly in the last month. And on the cat side, there may be a bit of differentiation.”
At a time when reinsurers are striving to innovate and create effective solutions for their clients, it is important for them to be willing to adapt, as Regazzoni explains.
“Reinsurers should think and work more closely with clients to understand their specific needs and have the willingness to deliver on these needs. They can also work closer with brokers to find solutions. It is important for reinsurers to be adaptable and flexible if they want to succeed,” he said.
Switzerland, re-domestication, Amlin Re