Reinsurance / Reaseguro / Resseguro

Reinsurance / Reaseguro / Resseguro
Dr. Sebastian von Dahlen
Santiago de Chile
15 November 2007
Introduction / Introducción / Introdução
Señoras y señores,
Disculpen que mi presentación sea en inglés. Mis escasos
conocimientos de español y portugués solo me permiten decirles
que pueden sentirse dichosos de que me esté limitando a esta
sola página.
¡Muchas gracias!
Estimados senhoras e senhores,
Peço desculpa por proferir a minha conferência somente em
língua inglesa, mas os meus escassos conhecimentos das
línguas portuguesa e espanhola são apenas suficientes para lhes
comunicar que se podem considerar felizes que agora acabo por
continuar a falar apenas em língua inglesa.
Muito obrigado!
2007 / Santiago
de Chile
Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
2
Today‘s schedule on IAIS and reinsurance
Index of contents
A) During PANEL (now)
Some background on:
– Current IAIS reinsurance work
– Selected Latin American data
B) During CASE STUDY (later)
Some basic insights:
– Reinsurance supervision
– Problems and solutions
2007 / Santiago
de Chile
Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
3
Importance of the IAIS
IAIS Mandate
• Standards and guidance for insurance
supervision
• Assist national supervisors
• Promote cooperation among insurance
supervisors
• Coordinate with other financial sector
and international organizations (Basel
Committee, IOSCO, Joint Forum,
Financial Stability Forum, etc.)
2007 / Santiago
de Chile
Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
4
Reinsurance and the IAIS
Executive
Committee
Technical
Committee
Reinsurance Subcommittee
Solvency
Subcommittee
Accounting
Subcommittee (incl.
Insurance
Contracts)
Reinsurance
Subcommittee
Governance &
Compliance
Subcommittee
Market Conduct
Subcommittee
Financial
Conglomerate
Subcommittee
Reinsurance
Transparency
Subgroup
Mutual Recognition
Subgroup
1. Main focus on
 Mutual Recognition
 Reinsurance Transparency
Executive Committee
Technical Committee
Reinsurance Subcommittee
2. Work also on
 Revision of IAIS Papers
Reinsurance Transparency Subgroup
Mutual Recognition Subgroup
2007 / Santiago
de Chile
Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
5
Pension
Coordination Task
Force
ICP Rev
For
Reinsurance Transparency Subgroup
Global Reinsurance Market Report
• Participants of report
– Supervisors from Bermuda, France, Germany, Japan
Switzerland, the UK and the USA
– 56 significant reinsurance entities
– Representing a very high proportion of the worldwide
reinsurance market
• Aim of report
– Increase transparency concerning worldwide reinsurance
market
– Indicate resiliency of the reinsurance market
 Source of information for supervisors around the world
2007 / Santiago
de Chile
Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
6
IAIS Global Reinsurance Market Report
Edition 2007 – new structure & new layout
Insights to relevant reinsurance market developments
New in the report: more reference to the overall capital market
Example:
Average CDS spreads for reinsurance, insurance and banks
60
50
Banks
Insurance
Reinsurance
40
30
20
10
2007 / Santiago
de Chile
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Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
7
IAIS Global Reinsurance Market Report …
… Edition 2007 – some life reinsurance focus …
…“Chapter III” provides assessments on:
a) pandemic risks
 e.g. potential avian flu
b) mortality risks
 e.g. graph below
http://www.iaisweb.org/
2007 / Santiago
de Chile
Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
8
Mutual Recognition Subgroup
Mutual Recognition of Reinsurance Supersvision
• Reinsurance protection
– Important risk mitigation tool for insurers
– Provide economic benefits for primary insurers and their
policyholders
Example: major natural catastrophes
(e.g. severe storms)
- Reinsurance provides protection
- Global risk diversification is important
 Supervisors should support, if
possible and appropriate, a worldwide
diversification of reinsured risks
2007 / Santiago
de Chile
Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
9
Mutual Recognition Subgroup
IAIS aim concerning mutual recognition
• To facilitate a system of efficient insurance and reinsurance
supervision: avoid unnecessary burdens
 Example: appropriate information sharing among supervisors
instead of a duplication of supervisory requests
• Please check IAIS website for the recently published
“Discussion Paper on the Mutual Recognition of Reinsurance Supervision”
2007 / Santiago
de Chile
Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
10
Reinsurance Subcommittee
Additional work planned for the near future
• Revision and updating of existing reinsurance
related IAIS papers
– „Standard on the evaluation of the reinsurance cover of
primary insurers“
– „Guidance Paper on finite reinsurance“
2007 / Santiago
de Chile
Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
11
Insurance and Reinsurance
Some insights into Latin America
•
•
•
•
2007 / Santiago
de Chile
Premium shares
Premium growth
Market penetration
Growth expectation
Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
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Latin America
Non Life premium
shares
America
NL Premium
shares*Latin
within LA
(2005)
Brazil
Mexico
Venezuela
Argentina
Colombia
Chile
Ecuador
Peru
Dominican Republic
Jamaica
Costa Rica
Panama
Guatemala
Uruguay
Trinidad and Tobago
El Salvador
Bahamas
Barbados
Honduras
Bolivia
Nicaragua
Paraguay
37.8%
21.4%
9.2%
9.1%
87.6%
5.6%
4.5%
1.5%
1.5%
1.4%
1.0%
1.0%
0.8%
0.8%
0.7%
0.7%
0.7%
0.6%
0.6%
0.4%
0.3%
0.2%
0.2%
0%
5%
10%
15%
20%
25%
30%
35%
40%
Source: VERA
2007 / Santiago
de Chile
Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
13
Latin America
Non Life premium growth 2000-2005
NL real premium growth 2000-2005*
Venezuela
12.5%
12.3%
Chile
Mexico
6.5%
Argentina
5.4%
Latin America
4.9%
World
4.4%
Colombia
3.9%
Brazil
0%
2.3%
5%
10%
15%
Source: Munich Re
2007 / Santiago
de Chile
Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
14
Latin America
Insurance market penetration
6
Penetration Non-life (%)
5
UK
USA
4
Global trend line
3
South Africa
Venezuela
Russia
Brazil
Colombia
Chile Argentina
2
1
Germany
S. Korea
Taiwan
France
Canada
Italy
Australia
New Zealand
Norway
Japan
Singapore
Mexico
India China
Philippines
0
0
year: 2005
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
GNI per capita in purchasing power parities (PPP-US$)
Source: VERA
2007 / Santiago
de Chile
Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
15
Chile
Growth expectation for a primary insurance market
2500000
2000000
1500000
1000000
500000
NL Trend BIP nom. (downside)
2014
2012
2010
2008
2006
2004
2002
2000
1998
1996
1994
1992
1990
0
NL Trend (GNI PPP)
Global Trend NL
source: AACH (history), Munich Re
2007 / Santiago
de Chile
Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
16
Reinsurance / Reaseguro / Resseguro
A source for further questions und answers:
http://www.iaisweb.org/
2007 / Santiago
de Chile
Case Study Reinsurance Scenarios
Dr. Sebastian von Dahlen, Principal Administrator IAIS
17