22nd May 2023
Steven Goate reveals discussions at the Insurance and Reinsurance Legacy Association (IRLA) Congress 2023, point to a dynamic market and one which will require a range of services which will see Davies in demand.
Once again, the IRLA Congress saw the market come together for a sold-out event, which was not short of topics to discuss. Those topics were broad and diverse, with several key themes which are likely to define the future market.
The event opened with a session on claims of abuse against the Catholic Church in the United States. In recent months, a growing number of state governments have extended the statute of limitations to allow abuse victims to come forward. It has prompted a significant rise in claims, and the likelihood is that the London market will need to brace itself for potential claims from the church if the level of awards break into the church’s reinsurance programmes.
The presentation was a sobering start to the congress but the event itself was once again expertly organised and managed by AMS.
While the event included a session around capital for the legacy market, there was a clear theme throughout the three days that the market for acquisitions remains buoyant. However, it comes with a growing recognition that there is likely to be a round of consolidations amongst the acquirer firms. How that will play out and the timescales around the consolidation process are not fully determined, but it is likely that we will start to see movement over the next couple of years.
In terms of capital, reinsurers are now looking to redraw their strategies as they consider the best home for the money in terms of the promise of a return, with legacy books seen as still offering opportunities.
We are also seeing portfolios acquired which contain reinsurance elements that have been neglected and come with a significant lack of reinsurance qualified staff and as such require reconciliation and collections made, processes we at Davies have been market leaders in for some time.
Companies are discovering that to deliver the best outcomes, you need the skill sets to effectively manage your legacy books. Increasingly that has seen a move to outsourcing to companies such as Davies, which have the inhouse technical expertise and experience to best deliver the returns on behalf of the clients.
With the rise in the number of companies looking to acquire books those books are being subject to intensive due diligence from a range of suitors.
This again has created a demand for staff which can undertake a thorough due diligence process, which has increased further pressure on the need for the sector to recruit experienced staff in what is becoming an ever more competitive environment.
Quite rightly a key theme again this year at the congress was the need to attract talent into the sector.
This has become ever more acute given the pressures around areas such as due diligence, regulation, and effective legacy and run off management. IRLA’s Young Professionals’ group was at the forefront of the event, and the year ahead is likely to see a significant focus on the battle for talent.
Delegates will have left the congress with plenty to think about. With a market which remains positive and opportunities in both the UK and US, the need for expertise has never been greater and it leaves Davies ideally positioned to continue to support our clients across the legacy and run off sector.
If you would like to continue the conversation, get in touch with Managing Director, Steven Goate at firstname.lastname@example.org
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