Post on 04-Jan-2016
DEVELOPMENT OF RUSSIAN INWARD REINSURANCE CAPACITY FOR OVERSEAS BUSINESS
Dmitry Garmash
Director, Ph.D. International Business Dept.Unity Re Ltd.
30th March, 2007г.President-Hotel, Moscow
For 2006 г. in Russia:
• Gross premium written in non-life insurance – $22,29 billion
• Gross premium written in inward R/I – $3,05 billion
• Inward R/I / direct insurance – 13,7%
23,1%
20,2%
• Overseas inward R/I share = 6,4% - about $196 million.
• 20-25% annual increase in inward R/I from overseas for last 2 years
160
198185
196
6.4
5.35.9
5.3
0
50
100
150
200
250
2003 2004 2005 2006
Mill
ion
US
$
0
2
4
6
8
10
12
14
16
18
20
(%)
GPW - inwardoverseasreinsurance
Share in overallGPW inwardresinsurance
Basic factors of inward R/I increase for today and for next 1-2 years:
• (re)insurers’ capital raise and enhancement + treaty coverage widening
• domestic market strength & narrowness search for new business sources
• expand of brokers’ geographical scope since 2004
• insurance cycle phaze demand for alternative markets
• stable demand for R/I coverage from emerging markets – Asia, Africa, Central & South America
Direction of inward R/I from overseas (cedants, GPW):
• close markets (CIS, Baltia, CEE)
• markets of stable cooperation (S.-E. Asia, Arabian region)
• markets of growing cooperation (America, Africa)
10%
75%
11%
3%1%
Quantitative aspects of inward R/I from overseas to Russia:
• regional difference in class structure
• basic classes: Property, Energy, Marine hull
• main channels: broker-reinsurer; broker-broker-reinsurer
• support for large global placements (>1 brokers, relatively small participation shares)
• “low-liquidity” risks placement (old brown-water fleets; risky single vessels, dangerous productions, under-market terms&conditions, dangerous territories)
Main market players dealing with R/I from overseas (professional reinsurers, insurers and brokers):
• Ingosstrakh
• Unity Re
• Kapital Re
• Moscow Re
• Moscow IC
• SOGAZ
• Rossiya
• Transsib Re
• Malakut
• Rifams
• Scanmarine
• Benfield
• PWS
• AFM
• Oakeshott
Estimated R/I capacity for overseas business:
Class Foreign business,
Million US$
Foreign business with Russian and former-USSR interest, Million US$
Property 25 400
Energy 15 200
CAR/EAR/MB 20 250
Marine Hull 50 120
Cargo 50 100
Aviation Hull 5 35
Development barriers:
• ratings and relative legislation
• regional borders
• available capacity
• incoming risks quality
• plecement terms & conditions
• global role of broker (documentary, payments, adjusting)
Developments aspects and perspectives:
• rating + financial strength enhancement
• regional brokers channel development
• further market M&A + foreign security for treaties demand for new sources of inward R/I
• region/class market niche stability
• more tight binding to worldwide/regional R/I market trend, environment and factors
• foreign capital in Russia and carefull U/W policy
THANKS FOR YOUR KIND ATTENTION!
For questions please contact:
Dmitry Garmash
Tel.: +7 495 203-5086, доб. 4946
Mob.: +7 926 203-7509
E-mail: re_gardv@reso.ru