CCR Re plots expansion into life area
CCR Re is looking to grow its life portfolio as
it says profitability in this segment is better
than in the property/casualty (P&C) market
where rates remain under significant pressure,
CEO Bertrand Labilloy, told Monte Carlo Today.
CCR Re is focused on P&C business,
which represents 63 percent of its portfolio.
Life represents 29 percent and specialty lines 8
percent of the portfolio structure.
CCR Re is also changing the business mix
of the organisation in other ways.
“We have already reduced our exposure
to long-term risks such as third-party liability
motor. We are working on the diversification of
our cat exposure,” Labilloy said.
The diversification in nat cat can be done by
increasing CCR Re’s shares in treaties. As the
shares are currently relatively small, they can
easily be increased, Labilloy said. Currently, CCR
Re’s non-life exposure is concentrated in northern
Europe, Canada, the Middle East, and Asia. The
reinsurer wants to have some non-life exposure to
Eastern Europe, South America, and Australasia.
Given the current market conditions, CCR
Re is not planning to grow its overall non-life
books and wants instead to seize opportunities
in the life segment.
“We have strong franchises. For us, it is not
difficult to offer new services. There are no
barriers to entry,” Labilloy said.
CCR Re’s life business operates primarily in
France and the Middle East. “Growth is very
strong on the life side,” he noted.
In order to expand the exposure to the
life segment further, CCR Re is considering
entering new markets such as Canada, Israel
and the Lebanon, Labilloy said. In preparation
for the expansion, CCR Re is recruiting experts
“We can provide the expertise and can
differentiate ourselves from competitors,” he
said. “We have the capacity to be very agile and
offer dedicated services to small and medium
direct insurers,” he explained. n
“We have strong franchises.
For us, it is not difficult to offer
Appleby points out flaws in reinsurers’ dreams of hard market
Re/insurers who have been wishing for the
return of the hard market should also be
aware of the true ramifications of what they
have been yearning for, according to Bermudabased
law firm Appleby.
Brad Adderley, partner in the corporate
department in Bermuda, said that reinsurers
should be careful what they wish for as a true
hard market is usually triggered by substantial
losses—losses that are rarely truly recouped
even when rates rise.
“If you have a $100 million line and you
lose $100 million, how much of an additional
increase in premium will have to occur before
you make back the money you lost? Do you
in fact ever make back the money you lost?”
“A real hard market occurs because you’ve
made a real loss. Assuming you survive that,
do you actually recover what you lost in those
catastrophic events? The last hard market was
about 10 years ago, as a direct consequence of
hurricanes Katrina, Rita and Wilma.
“It would be interesting to take an analyst
from a company that was in that hard market
and ask ‘you lost a billion dollars—did the
increase in premium cover that billion dollars?’.
Unless you recover your losses, why do people
want a hard market?”
An additional angle to that thesis was
pointed out by Tim Faries, managing partner at
Appleby. He said that another consequence of
a very big loss is that the perception of demand
for risk products is greater. He noted that in
the course of the past 12 years there have been
few high-profile events apart from Hurricane
Sandy, meaning that perception has decreased.
Faries pointed out that the consumer side
might also be a factor in the industry, forming
“As consumer demand increases, prices go
up; the market will respond even if everything
that Brad was saying is accurate and true. What
the optimal market level is, or should be, is
something that will play out.” n
Tim Faries (left) and Brad Adderley
16 | MONTE CARLO TODAY | DAY 4: Wednesday September 13 2017 www.intelligentinsurer.com | www.bermudareinsurancemagazine.com