The reinsurance program in force from January 1[st] 2020 was placed with an average cession of 29% given current volume forecasts. The program covers insurance sold and renewed in 2020. The forecasted average reinsurance level for the accounting year 2020 is 33%. This is down from 41% in 2019. Terms are largely unchanged, which is a strong outcome, given the higher than expected loss ratio for the whole Norwegian market at the beginning of 2019, and its impact on reinsurers' results.
The chosen cession level is higher for property than motor, as property results are more volatile. The overall reduction in cessation level is in line with our strategy. At this reduced level and with the terms achieved for 2020, the balance between risk transfer and cost makes reinsurance an efficient capital management tool, which will remain in Insr's toolbox. The cession will be further reduced in future years, but likely at a slower pace, and depending on top line development.
Our reinsurance panel is very strong. No reinsurer is rated below A- and the majority of the premium is ceded to reinsurers with an S&P rating of AA- or higher. The panel is stable, and Insr appreciates the sustained commitment to our business from this community of the most skilled insurance experts globally.
By retaining more insurance risk, our earnings potential increases, but the volatility in technical results will also increase. In the annual Own Risk and Solvency Assessment (ORSA), adopted by the Board on
The risk appetite of Insr has been unchanged since Solvency II was introduced, stating that actions will be considered if the solvency ratio falls below 130%, and that actions must be taken to increase the solvency position should the solvency ratio fall below 120%. As communicated in stock exchange notices on October 10[th], a target solvency ratio of 150% was also introduced, and over time we intend to operate above this level.
For further information, please contact:
T: +47 926 10 606
E: anne.b.knudtzon@insr.io
Partnership insurance made easy. Insr enables you to broaden your customer or member offering through white label and co-branding insurance solutions. We provide insurance risk capital and insurance expertise, whilst you maintain your customer or member relationship. Insr is regulated by the Norwegian FSA (Finanstilsynet) and has a license for all groups of non-life insurance, except for credit and guarantee insurance.
https://news.cision.com/insr-insurance-group-asa/r/insr--successful-reinsurance-placement--well-positioned-to-handle-volatility-with-current-capital,c3002056
(c) 2020 Cision. All rights reserved., source