Esra KULAN, MILLI Re: What are the characteristics of the CEE reinsurance market?
The CEE region is characterized by motor insurance driven markets (especially compulsory MTPL), this representing more than 55% of the total Non-Life written premium, explained Esra KULAN, Deputy Head of the Foreign Inward Department, MILLI Re, at FIAR 2017, offering an insight into the reinsurance landscape in 2017 & Nat Cat Risk's transfer in reinsurance in the CEE region.
Moreover, in the CEE region, the property branch represented only 14.5% of total non-life written premiums in 2016, Esra KULAN added.
As far as the CEE region reinsurance landscape is concerned, this is characterized by several factors, Esra KULAN said, including:
- Group reinsurance protection is more common
- Dominance of big group companies, mainly European, in premiums earned, as well as in losses occurred
- Continuous trend of M&A activities of these big insurance groups across the region
- Reducing operational costs
- Stronger negotiation power for favorable price and conditions
- Changing political and regulatory environment, which affect insurers and reinsurers as well - the regulations protect the local markets more
- Thus, this change is supporting European Union reinsurers, leaving less room for non-regional players
- Solvency II
- Adds administrative burden and cost to insurers
- It will strengthen the capital in the insurance markets
- Increases demand for reinsurance because of demand for capital relief solutions, mainly in Motor and Property classes
Author: Adina TUDOR