The reinsurance program works. The bottleneck is evaluating alternative structures before the renewal window closes.

European insurers allocate 15 to 40 per cent of premiums to reinsurance. Actuarial teams need weeks to model each treaty structure scenario. Meanwhile, emerging exposures such as cyber or climate catastrophes are not reflected in coverage in time. Outstanding recoveries from prior loss events accumulate, and every percentage point of leakage on an EUR 18M program means EUR 180,000 lost annually. The January 1st renewal does not wait.

Swiss Re, Munich Re, Aon 2024