Market Overview

Best's Market Segment Report: Munich Reinsurance Company Reclaims Top Spot in A.M. Best's Top 50 Ranking of Global Reinsurers

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The first five positions in A.M. Best's annual ranking of the Top
50 Global Reinsurance groups experienced some reshuffling in 2017, most
notably in the top spot as Munich Reinsurance Company reclaimed the No.
1 position from Swiss Re Ltd. Outside of 2017, when Swiss Re Ltd. held
the top spot, Munich Reinsurance Company has held the top spot each year
since 2010, as detailed in the new Best's Market Segment Report,
"Global Reinsurance: Optimism Fizzles, It's Back to the ‘New Normal.'"
The 2018 ranking is based on reinsurance gross premiums written, with
Munich Reinsurance Company and Swiss Re Ltd. comprising approximately
30% of the Top 50 total.

Berkshire Hathaway Inc. moved up two spots from last year's ranking to
No. 3, pushing Hannover Rück SE and SCOR SE to the four and five spots,
respectively. The nearly $10 billion reinsurance agreement between
Berkshire Hathaway's National Indemnity Co. and American International
Group Inc. primarily drove Berkshire Hathaway's jump in the ranking.
Although the agreement between the two companies was finalized in
January 2016, it was not accounted for until first-quarter 2017. Despite
dropping in the ranking, Hannover Rück SE and SCOR SE experienced
year-over-year double-digit gross premiums written growth.

The bottom half of the Top 10 positions remained unchanged from the
previous year. Overall, the Top 10 reinsurance groups make up slightly
more than 70% of the total gross premium written in the Top 50 ranking.
"The amount of gross premiums written by the Top 10 in A.M. Best's
ranking reinforces the sentiment that the industry's largest reinsurers
continue house disproportionately sizable amounts of risk, despite
cedants' efforts to diversify their reinsurance panels and spread out
their counterparty risk," said Robert DeRose, senior director.

Merger and acquisition activity continues to influence the rankings,
including the most dramatic change in the 2018 ranking, as Sompo
Holdings, Inc. jumped from No. 22 from No. 46. Year-end 2017 was the
first year that Endurance Specialty Holdings Ltd. (now Sompo
International Holdings Inc.) was consolidated into Sompo's financial
reporting, leading to an estimated 265% increase in the company's life
and non-life gross premium written.

The Top 50 reinsurance groups recorded an average combined ratio in 2017
of 109.1%, mainly due to catastrophe losses. The Top 5 average combined
ratio was slightly higher at 109.7%, which echoes the segment's results
and reinforces the syndicated nature of the sector.

Other highlights from this year's report include:

  • QBE Insurance Group Limited and W.R. Berkley Corporation experienced
    the most notable downward movements, by 14 and 7 positions,
    respectively;
  • Two sub-rankings of top non-life and life global reinsurers, which
    highlights reinsurance groups that hold a true global footprint or
    business profile; and
  • An explanation of the methodology employed by A.M. Best to form its
    Top 50 Global Reinsurance ranking.
  • The global reinsurance report also explores the state of the
    insurance-linked securities market following the 2017 catastrophes,
    along with in-depth reviews of the Lloyd's and life reinsurance
    markets, as well as geographic regions such as Asia/Pacific, Africa
    and Bermuda.

To access a copy of this market segment report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=277679.

A video
interview
with A.M. Best Associate Director Scott Mangan and
Financial Analyst Victoria Ohorodnyk on the top 50 reinsurance group
ranking is available.

A.M. Best will present a webinar, "The Road to Convergence: Global
Reinsurance and the ILS Market," on Thursday, Sept. 6, 2018, at 10 a.m.
EDT, on reinsurance industry trends. Register at no charge at www.ambest.com/webinars/global18.

A.M. Best will host its annual Reinsurance Market Briefing at the 2018
Rendez-Vous de Septembre (Rendez-Vous) on Sunday, Sept. 9, 2018, at the
Hermitage Hotel in Monte Carlo, Monaco. The briefing will start at 10:15
a.m. and conclude at 11:45 a.m. (CEST). To register online, please click
the following link: www.ambest.com/conferences/rmbseptembre2018.

A.M. Best is a global rating agency and information provider with a
unique focus on the insurance industry. Visit
www.ambest.com
for more information
.

Copyright © 2018 by A.M. Best Rating Services, Inc. and/or its
affiliates. ALL RIGHTS RESERVED.

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