22-09-2020
Cost of pandemic is far beyond capacity of reinsurance
Insurance AlertssCost of pandemic is far beyond capacity of reinsurance
In an interview hosted by Aon's reinsurance solutions, Swiss Re Reinsurance CEO Moses Ojeisekhoba addressed the impact of the COVID-19 pandemic and said that the crisis should make the industry realise that swift and positive change is achievable.
“It was remarkable, for an industry that people say doesn’t embrace change, that when it was necessary, in one week, two weeks, a month, we saw a complete metamorphosis. And I think we have to take some learnings from that in terms of what we are capable of doing,” he said.
The interview was a fireside chat which is part of Aon’s virtual reinsurance renewal season. Mr Ojeisekhoba said that the total cost of the pandemic was far beyond the capacity of the (re)insurance industry, which is why effective public-private partnerships were essential.
“We need to work with the public sector to ensure that the right backstops are put in place, so that when something like this happens again, it doesn’t have the same devastating effect on economies,” he said.
He also pointed out that the challenges of the pandemic were surmountable, attesting to the value of long-term industry relationships, which had remained intact through many crises.
Mr Ojeisekhoba also highlighted low interest rates as being a ‘super important’ factor in the current business environment. He regarded it as a major challenge faced by the (re)insurance industry due to their impact on (re)insurers’ investment returns, with the casualty and life business particularly affected due to the longer-tail nature of the exposures.
Source: Asia Insurance Review
