Emmanuel Clarke said PartnerRe’s life and health business had grown by 23%

PartnerRe’s president and CEO Emmanuel Clarke is optimistic for his company and for the reinsurance sector. He told GR that cedants would be looking to divest volatility in their books. His own firm will diversify its risks through expanding its life and health business, he said.

“We’re seeing demand for risk transfer because of new types of risk coming into the market. There will also be more demand for risk transfer because of increasing distaste for volatility among primary insurers,” Clark said.

He emphasised PartnerRe’s place in the market as a pureplay reinsurer. “That’s a contrarian play,” Clarke said. “Other reinsurers are going into the primary side, but we’ve said no, that’s not for us. We can’t be a partner for our clients if we eat their lunch and poach their teams.”

He suggested that PartnerRe clients had told the firm its pureplay strategy was the reason they maintained relationships and would do more business with the Bermuda-domiciled reinsurer.

Organic growth

Mergers are not a focus for the firm, Clarke emphasised, instead focusing on organic growth. He noted that the company had grown its non-life business by 20% but its life and health business by some 23%.

Since buying Canadian life insurer Origin three years ago he said that life and health would be an increasing diversifying focus for the company.

“Life and health provides good risk and return characteristics, with a long-term 10-11% return on equity,” Clarke said. “Life reinsurance also has much higher entry barriers – that’s why there are only eight carriers. That’s not the top tier, that’s it,” he said.

Growing life and health business would reduce PartnerRe’s cost of capital, Clarke emphasised. “You can grow premium of life and non-life combined faster than the capital required to support it, because of that diversifying factor,” Clarke added.

 

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