A.M.BestTV: ‘First Monday’: Rated U.S. Captives Show Some Stress in 2014
04 August 2015 - 4:33AM
Business Wire
In this first of five “First Monday” episodes, A.M. Best
Assistant Vice President Steven Chirico said that despite U.S.
captive insurers continuing to outperform the commercial insurance
sector, industry results are showing some decay. Click on
http://www.ambest.com/v.asp?v=fmcaptives815 to view the video
program.
The remaining “First Monday” episodes will focus on how U.S.
homeowners insurers are harnessing advanced predictive models; how
the Middle East is ripe for mergers and acquisitions; how insurers
have increased their overall risks and reduced their liquidity in
investments and how fluctuating oil prices are hampering Nigeria’s
insurance market. “First Monday” is A.M. Best’s monthly program
featuring commentary by the company's leading analysts.
Captives make up about 20%-35% of the commercial market, which
includes onshore and offshore companies, with most of them being in
the Western Hemisphere as oppose to Asia and Europe.
“For rated and non-rated captives, 2014 was not as good a year
as 2013; however, captives are still outperforming the commercial
market,” said Chirico. “Group captives are stumbling a little with
decaying performances, but single parent captives and risk
retention groups have had significant increases. From an operating
performance perspective, loss and loss adjustment expense ratios
for captives, as a whole in 2014 – 69.4%, compared to 57.3% in
2013, and combined ratios before policyholder dividends were 83.6%
compared to 71.6%, respectively.”
Chirico also said that the continuing soft global market,
particularly the soft reinsurance rates, speaks to what is
happening in the deterioration of the operating performances of
group captives.
On Tuesday, August 4, 2015, A.M. Best will have its annual
webinar on “State of the Captive Insurance Market,” from 2:00 p.m.
to 3:00 p.m. (EDT). Register at no charge at
http://www.ambest.com/webinars/captive15.
To read the latest special report on the captive industry,
titled, “Group Captives Feeling The Squeeze, Single Parent Captives
Winning The Race,” please visit
http://www3.ambest.com/bestweek/purchase.asp?record_code=240126.
Recent episodes of A.M.BestTV include:
- How Katrina Changed Today’s
Insurance Industry: Hurricane Katrina has brought to insurance
new understandings and ways of dealing with catastrophe risks and
complex losses 10 years after it devastated Louisiana:
http://www.ambest.com/v.asp?v=katrina715.
- Analytics Continue to Transform
Insurance Industry: How big data and analytics continue to play
an ever increasing and important role in the insurance industry.
Two just released industry reports from Novarica and Capgemini
explore how insurers are looking to harness data across all facets
of business: http://www.ambest.com/v.asp?v=bigdata715.
- Insurers Develop New Ways to Trigger
Disaster Coverage: Brokers and insurers are borrowing from the
catastrophe bonds world by developing coverage against natural
perils that are triggered by measurable parameters rather than
traditional claims reporting:
http://www.ambest.com/v.asp?v=parametric715.
- Insurer Mitigates Wildfire Damage
With Tree Effort: The Philadelphia Insurance Companies
is partnering with the Arbor Day Foundation to mitigate disaster
prevention, namely wildfires, by planting 80,000 trees:
http://www.ambest.com/v.asp?v=arbor715.
A.M.BestTV covers exclusive A.M. Best information and reports,
targeted topics and key developments in the (re)insurance industry
every Monday, Wednesday and Friday. Sign up for alerts of episodes
at http://www.ambest.com/multimedia/ambtvsignup.html. View
A.M.BestTV episodes at http://www.ambest.tv.
A.M. Best Company is the world’s oldest and most
authoritative insurance rating and information source. For more
information, visit www.ambest.com.
Copyright © 2015 by A.M. Best Company,
Inc. ALL RIGHTS RESERVED.
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version on businesswire.com: http://www.businesswire.com/news/home/20150803006174/en/
A.M. BestLee McDonald, 908-439-2200, ext.
5561Group Vice President, Publication and News
Serviceslee.mcdonald@ambest.com