An invisibility cloak that protects reinsurance underwriters from the unwanted attentions of brokers and journalists is being trialled at the Rendez-Vous this year.
The invisibility cloak worn by the underwriters of a Bermuda reinsurer is made from metamaterial. Metamaterials are materials unavailable in nature or Marks & Spencer, in which the microstructure is changed to create unusual properties such as bending of electromagnetic waves. The magic illusion of disappearance stems from bending light in an unnatural way.
The so-called conference cloaking device, bends light around the reticent underwriter so that you dont see him or her, but you also dont see that the light has been bent.
It enters the material in a straight line and it also leaves the device in the same direction in came from, as if nothing had happened to it. The technology could be applied in the areas of communications, wireless energy transfer, sensors and security.
Obviously, its important that this science can be applied for human good, to improve the quality of life, to improve health and to drive economic growth, said one invisible Bermuda underwriter. But if it keeps brokers off my back, thats even better.
The underwriter denied he had used the invisibility cloak to sit in on meetings between rival Lloyds underwriters and their clients. I dont need an invisibility cloak to know what rubbish they are talking, he said.
Ian Glasses, CEO of Lloyds insurer Luddite Ltd, said he welcomed the news of Bermuda executives wearing the invisibility cloak: If it means not having to look at those ridiculous schoolboy shorts, Im all in favour of it.
Start-up company corners niche services
A new full services reinsurance company, Gotitall Re Inc, is launching at the Monte Carlo Rendez-Vous and will be providing its services from a luxury villa in the hills outside Monte Carlo.
We have seen a major gap in the market in terms of services provided to the insurance industry, said Charlie Sleeze-Bouquet, marketing manager of Gotitall Re. Were talking about fundamental services, things that the industry simply cannot do without, cannot function without, and yet solutions that are not to be found anywhere in the market.
The formation of Gotitall Re is based on a simple philosophy: You want it, weve got it, you pay loads for it, we provide it no questions asked, said chief executive Mickey The Provider Ancelloti, a well-known businessman from New Jersey. The market is full of service providers offering back office function, accounting, cat modelling, exposure analysis, capital market capability, he explained. But I ask you, is this what insurers really want? (Yes Ed).
Ill tell you what they want. What they really, really want. They want the latest weather reports and Im not talking about sticking your head out of the window, were talking days in advance.
He went on: They want proper modelling not catastrophes, everyones doing that. Jeez, I could do that on my own, listen, you live near the Caribbean or the east coast of the US, you gonna get a hurricane or two. West coast, you got earthquakes and fires. Rest of America twisters, floods and fires. See, easy.
No, what Im talking about is non-catastrophe modelling. What will the losses and exposure be like if there is no hurricane, or earthquake, or wildfire. Eh? Understand? No-one thinks about that do they? What are my estimated maximum losses if a Category 5 hurricane doesnt hit Miami? We have quality models that predict what the losses will be in the event that a massive earthquake doesnt flatten San Francisco.
Oh yeah, I nearly forgot. We also got plenty of models with the wristbands, plus a class A drugs menu and a liver transplant service.
Dissant Re to initiate novel buy-back programme
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.
In the event, neither occurred, and the company has faced massive underwriting losses and a ridiculous combined ratio in the 1,000s.
As a result, the companys 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, wed 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, thats not fair.
Dissant Re is offering $100 for every $100 of reinsurance premium received in its buyback programme. Fairs fair. Well pay back the premium, less commission, and call it quits, said Ms Downtown. After completion of the buy-back programme, Dissant Re hopes to become an acquisition target.
News in Tight Briefs
The Caribbean Island of Rumbaba has said that the executives of any reinsurers relocating their headquarters to the island will have unlimited work permits and automatic dual citizenship as soon as they arrive. It is believed that the rights will also apply to any support staff, security staff and cleaners that relocate to the island. They will all have the right to vote, to stand for parliament, in fact they will be given seats on the legislature, and may be given honorary presidentships and seats on the United Nations.
The Brazilian regulator has announced a new reinsurance regulation designed to simplify the current rules which were universally criticised for being too complicated. Under the new rules, 43% of the first 12% of every $110 million of reinsured covers must be shown to the local reinsurers, who have first refusal on the last 87% of all paid loss retro covers, and a third of 61% of all reinsurance covers above a $20 attachment point beyond the $400 million deductible, with half year carryover provisions. Except for grandfathered quota share loss portfolio transfers.
Hope that clears things up said the regulator Alberto Bossa-Nova.