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Success Story

Reinsurance supports ‘think global, act local’ client business model

Insurance Consulting and Technology|Reinsurance
Insurer Solutions

January 12, 2019

We provided our client with a reinsurance solution addressing both operating unit issues around lower risk retention and corporate large limit criteria.

The client challenge

While our client delegates responsibility for results to its various operating units, it needs to control macro issues and potential correlations between operating units, particularly in regard to catastrophe events and claims handling. The protection the company purchases needs to address both operating unit issues around lower risk retention and corporate large limit criteria. The absence of any systemic coverage and the unsustainable level of loss relative to ceded premium in the incumbent policy (arranged by another reinsurance broker) led to the business being retendered.

Our solution

Two innovative Willis Re products helped the client address its particular needs and wants and earn us the business. The first, PRIMO – which also informed the remainder of the reinsurance structure – provides broad-based catastrophic event-based clash, systemic clash and contingency protection on a losses discovered basis that makes it of interest to a broader cross-section of the reinsurance market.

The second is a unique contingency cover, devised and negotiated by Willis Re with substantial analytics input. This cover simultaneously addressed the operating units’ needs for lower retention rates and the corporation’s need for substantial limit. By having a flexible retention responding to various net policy limits, the retention floats up or down and is more sensitive to the operating unit portfolio profile. As with PRIMO, this cover used an as losses discovered trigger to open up placement to more underwriting capacity.

The outcome

The ability of Willis Re to bring together a team including experts in analytics (to help the client and reinsurers evaluate the economics), contract wording (to ensure that the terms of the reinsurance were precise), and broking (to ensure that the deal was syndicated and placed in accordance with terms and pricing targets) earned praise from the client’s senior management. PRIMO’s previous track record was cited as a major factor in the client switching the business to Willis Re.


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