REINSURERS OPEN TO NEW IDEAS WILL HAVE LITTLE WORRY ABOUT: VICKERS

Reinsurers that are open to new ideas have little to fear from the influx of third-party capital, according to Willis Re chairman James Vickers. Speaking to Insurance Day, Mr Vickers said that, at the forthcoming renewals, "most of the buyers in Europe, especially those with no losses on their books, will be looking forward to some reasonable rate reductions. Not huge ones and nothing like that which we saw on some of the US renewals mid-year, but a continuation of the rate reductions they have enjoyed". However, he felt that the interesting question was, what would cedants do with the money saved? Mr Vickers observed that some cedants were just looking for a better price, while others were seeking a combination of lower prices and more efficient covers – such as procuring more cover at the lower end of the programme. Where reinsurers could win, claimed Mr Vickers, was by being flexible on covers, which could assist the balance sheet of cedants. “The reinsurers that have the depth of skills and are subtle in the ways they use those skills to structure interesting products for their clients they want to write, they will trade through quite successfully,” he said.