Industry Analysis & Industry Trends
The Global Reinsurance Carriers industry, which essentially provides insurance coverage to primary insurers, has grown slowly in the past five years. Low interest rates have constrained investment income, while a softening insurance market has tempered growth in premiums. Nevertheless, the industry is expected to return to more robust growth in the next five years, particularly in emerging markets. While the lingering effects of the financial crisis will continue to dampen revenue in more developed economies, rising interest rates, particularly in the United States, will boost the industry's investment income... read more
Starting a New Business
Regulations for reinsurance tend not to be as high as for primary insurance industries. Reinsurers normally have to apply for an operating license in each of the countries they seek to operate. Gaining a license generally requires reinsurers to demonstrate a solid operating record, healthy balance sheet and excess surplus to suffice all ordinary contingencies in addition to minimum capital requirements. In establishing operations, reinsurers must also submit regular performance reports and continue to conform to minimum capital and solvency standards.
The need to meet minimum capital requirements imposes substantial start-up costs on reinsurers. This presents another major hurdle for entry into the industry... read more