You may notice a few changes in this issue of Global Reinsurance. The magazine is now carrying several columns which you will see from now on in each issue. These are designed to help the reader navigate through the magazine, and hopefully provide a slightly wider view of the re/insurance sector.
The first viewpoint column has been written by Dennis Mahoney, chairman and CEO of Aon Ltd. Dennis is not one to curb the pen, and in this article he asks how long the current hard market will last, but, more than this, looks at the possible fundamental structural change the re/insurance market may currently be facing. Each month, the viewpoint column will carry the views of an industry leader such as Dennis, and will be complemented by the outlook column. This new feature of the magazine will enable readers to find out what the analyst community thinks about the re/insurance business. This month sees Morgan Stanley airing a cautious view for pan-European insurers, but a generally more positive attitude towards large reinsurers.
Spotlight on Montpelier Re
The new insight column will each issue take a look at one of the businesses in the sector. This month turns the spotlight on Montpelier Re, one of the Bermuda class of 2001, and the first of its peers to successfully IPO on the New York Stock Exchange last year. Montpelier's president and CEO Tony Taylor - for years one of the brightest stars in the London market firmament - explains why he is keeping the business firmly planted on Bermuda rather than taking the multi-centre underwriting approach of several of his new peers.
Another new feature for Global Reinsurance in 2003 is our innovation column. Each issue, this will look at an aspect of science or technology which could have implications for the re/insurance sector. This month's column looks at the health exposures associated with mobile phone technology, assessing various scientific studies which have been conducted over recent years in an attempt to establish whether there are potential liabilities for the re/insurance community.
Changes of a different nature are outlined in the new framework column, which looks at regulatory advances or legal decisions which may impact the industry. This month's column takes a look at the Kvaerner ruling in the European Court of Justice which means that the re/insurance community must now pay insurance tax in the European member state in which a risk is domiciled, rather than where a parent company is established.
Worldview is another new feature of Global Reinsurance. It is easy to perceive the reinsurance and insurance industries as somehow divorced from the general business climate, when this is patently not the case. This month's worldview asks what sort of implication a war in the Middle East will have on the industry, with increased war risks and the prospect of oil prices rising even further.
The penultimate of the new features is the strategy column, a monthly look at management issues. This month's column addresses the issue of marketing through the insurance cycle, asking whether re/insurers have really grasped the nettle of branding, or are just playing around the edges. Insurance brands have taken a battering in recent years, with several of the strongest no longer around, but the authors argue that insurers are themselves at fault, having failed to focus on the individuality and uniqueness of the brand itself and to communicate these strengths unambiguously and, above all, consistently to the customer.
Finally - and fittingly at the back of the magazine - we introduce the new Global Reinsurance lexicon. Each issue this column takes a sideways look at a common term in the industry. For its inaugural outing, A is for ART, though it disputes what, really, is alternative.
January 2003 was the fiftieth anniversary of the North Sea floods, which devastated tracts of eastern England and the Netherlands, and resulted in 1,900 people losing their lives. Last summer's massive floods in central Europe have proved that in half a century, little changes in the realms of natural catastrophes. In fact, if anything, the increase in construction on flood plains and in coastal areas has led to a greater exposure to these types of weather-related events. Monika Gruber of Swiss Re Germany argues in her article on page 22 that it is irresponsible of governments to provide a complete back-stop for flood losses, since such provision will not change attitudes towards building in perilous areas and will inevitably lead to greater economic loss in the longer term. And maybe a change in risk perception is what is needed as a whole.
By Sarah Goddard
Sarah Goddard is the editor of Global Reinsurance.