Gallagher Re report provides assessment of risks caused by inflation on the (re)insurance sector

26 May 2022


ICMIF Supporting Member Gallagher Re has published a new report featuring its latest assessment of the inflation risks facing the insurance sector. The report has been prepared by Gallagher Re’s Strategic and Financial Analytics and Customised Solutions teams.

Key findings from this report include:

  • The debate has moved on from whether inflation will spike to how long it will last. Financial markets have begun to price in more pernicious longer-lasting inflation.
  • Looking across the major non-life lines of business, there is either evidence of inflation of underlying cost drivers today or an increased risk of inflation taking hold.
  • Insurers are getting help from the asset side, but slowly and from a low base.

The report outlines a number of steps insurers can take to mitigate their exposure to inflation risks. These include reevaluating deductibles on the policies they write as well as attachments on their reinsurance programmes, putting in place retrospective covers, and considering structured reinsurance solutions in order to reduce spend, if faced with higher reinsurance prices.

The effects of cost inflation on reinsurance pricing and claims situations was one of the themes discussed during the opening panel discussion on “Current state of the reinsurance market” at the 2022 Meeting of Reinsurance Officials (MORO), held in Wiesbaden, Germany, from 16 May to 18 May 2022. The MORO is a unique, global gathering of reinsurance professionals from the mutual and cooperative sector that normally meets every two years.

In the opening panel discussion, which looked at the latest developments in the reinsurance market and featured the cedant, reinsurer, broker and rating agency perspectives, Gallagher Re were represented by Dirk Spenner, Managing Director EMEA North/East.

ICMIF members can access the recordings and presentations slides from each session of the 2022 MORO by contacting Mike Ashurst for more information and the necessary links.

For member-only strategic content on the cooperative/mutual insurance sector, ICMIF members have exclusive access to a range of online resources through the ICMIF Knowledge Hub.

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