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Archived stories from 2011

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Dissant Re buys back reinsurance coverage

Dissant Re is to initiate a buy-back programme of its outstanding reinsurance coverages. The buy-back programme will cover the last 12 months. A spokeswoman for the company, Abby Downton, said that the reinsurer wished to buy back all the reinsurance cover it gave away for peanuts in the misplaced hope that 2011 would be a cat-free year and that investment returns would improve.

Abby Downton, Dissant Re

In the event, neither occurred, and the company has faced massive underwriting losses and a ridiculous combined ratio in the 1000s. As a result, the company's preference is to redeem its share of reinsurance coverage offered to cedants, preferably at cost.

Ms Downton said the company had not priced the catastrophe cover adequately. "If we had known there were going to be so many catastrophes, we'd have increased the rate dramatically. Or more likely, pulled out of nat cat covers altogether. I mean, two earthquakes in New Zealand? And then one in Japan? And a hurricane hitting New York? Come on, that's not fair."

Dissant Re is offering a book value of $100 for every $100 of reinsurance premium received in its buyback programme. "Fair's fair. We'll pay back the premium, less commission, and call it quits," said Ms Downtown.

After completion of the buy-back programme, Dissant Re will once again be profitable and the last 12 months will fade away to a distant nightmare.

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Other news from Sep 2011
 
Travelating the Wave of Insurability
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