Tuesday September 23, 2008
FRANKFURT: Munich Re sees opportunities to push through double-digit price increases following the rescue of American International Group (AIG) by the US government, a Munich Re board member said.
The world’s biggest reinsurer is targeting price increases that were “clearly in the double-digit percentages” for the risk cover it provided to insurers in 2009, Torsten Jeworrek told the Financial Times Deutschland newspaper in an interview conducted on Friday.
Insurers, who pass on some of their risks to reinsurers in exchange for part of the premium, will hammer out contracts in the coming weeks on the price and extent of risk cover for 2009.
“We have a situation in the reinsurance market that is similar to that after Sept 11, 2001,” Jeworrek said in the interview published yesterday.
“The market is significantly different from a week ago,’’ he said. “From now on it’s a hard market. The soft market is behind us.”
Reinsurers refer to periods of high prices and favourable conditions for them as a “hard market.” - Reuters
http://thestar.com.my/news/story.asp?file=/2008/9/23/business/2093275&sec=business
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