Atlas Magazine October 2004

Monte Carlo: the insurers' barometer

Now that the summer break is over, the Monte Carlo Rendez vous has kick-started the insurance industry.

Despite the relative decrease in interest and growth noticed throughout recent years, Monte Carlo remains the ideal venue where it is possible to gauge the growth of the profession, to diagnose its state of affairs and to assess trends.

Unfortunately, Monte Carlo's clear skies have abruptly been tormented by a couple of bad news.

The first one, poured in like thunder, regards one of the reinsurance leaders, Converium, whose rating has been revised downwards. Particularly feared by companies, the impact of such a measure is well-known. Fervent partisans of the security list that gathers the system's elite, the big brokers and companies are going to refrain from dealing with a flunkee, who will be systematically driven out of big business.

Despite the big damage incurred in the short term, this sanction should not lead insurers and reinsurers to forget that Converium has the means to quickly pick up and recover from its mess.

SCOR, one of the leaders of the market, has, in recent time, witnessed the same fate. The French reinsurer's recovery is now in full swing thanks to its internal restructuring program, its drastic underwriting policy, and owing to the solidity of underwriters who managed to maintain the trust of their customers.

The SCOR case shows that the rating of an agency, however powerful, may be eased by the actions undertaken on the field by underwriters – a lesson of great inspiration to Converium.

The second major source of concern to the professionals during this venue is hurricanes, whose season is far from over yet. Charley, Frances, Ivan, Jeanne will weigh down reinsurers' accounts, and are now diminishing the likelihood of tariff cuts.

It will be the Baden Baden venue that will ultimately define the 2005 trends.

Advertising Program          Terms of Service          Copyright          Useful links          Social networks          Credits