Vigilance needed for continued re/insurance stability – Swiss Re

Vigilance needed for continued re/insurance stability – Swiss Re | Insurance Business Australia

Reinsurance

Vigilance needed for continued re/insurance stability – Swiss Re

Pricing adequacy and risk sharing will be key

Reinsurance

By
Kenneth Araullo

Moses Ojeisekhoba, Swiss Re’s chief executive officer for Global Clients & Solutions, has shared insights into the evolving re/insurance sector, emphasizing a significant shift in how catastrophic risks are shared and the importance of pricing adequacy.

Ojeisekhoba noted that these changes are crucial to provide clear signals to clients and society about the increasing costs of risks and the strategies for mitigating them, especially in a world where volatility remains a constant challenge.

At the 2024 World Economic Forum in Davos, Switzerland, discussions underscored global leaders’ concerns about issues such as ongoing conflicts, the persisting threat of inflation, and the impact of technological advances like generative AI. Ojeisekhoba highlighted the critical role of building trust in these technologies to maximize their benefits, alongside tackling the enduring challenge of climate change.

Ojeisekhoba pointed out the re/insurance industry’s strides toward a more balanced risk-sharing approach, which had been out of equilibrium for much of the last decade. Improved pricing strategies and more predictable terms and conditions now enable reinsurers like Swiss Re to effectively partner with a diverse range of stakeholders.

This reset, the CEO noted, places reinsurers in a better position to act as resilience-building entities, offering shock absorption in times of crisis.

However, despite this progress, Ojeisekhoba observed that achieving a healthier equilibrium in risk-sharing is an ongoing effort. The intensity of global risks necessitates continued vigilance and underwriting discipline to stabilize the reinsurance cycle and address the evolving nature of 21st-century risks.

Looking ahead to 2024, Ojeisekhoba underscored the dynamic nature of global risks, from natural catastrophes to economic and geopolitical shifts, all contributing to a widening protection gap.

He also stressed the importance of the re/insurance industry’s role in addressing these challenges, including monitoring social inflation trends and the potential impact of numerous global elections on the geopolitical landscape.

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