Scor chief executive Denis Kessler says Scor has no need need to sell to Covea
Scor chief executive Denis Kessler claimed the company is in “fantastic position”, once again batting away suggestions about selling to French mutual insurer Covea.
“We are extremely proud to be independent,” Kessler told the listening press pack in Monaco.
Speaking at the Monte Carlo Rendez-Vous, Kessler said that five years ago at the conference he predicted merger activity between what he calls tier two and tier three companies – small- and medium-sized reinsurers.
Consolidation has been driven by such factors as reinsurers needing scale, technological expertise or the increasing demands of regulation.
But Kessler said those drivers do not apply to the tier one players and Scor was doing very well by itself. Parisian headquartered Scor is the fourth largest reinsurer globally by premium, behind Munich Re, Swiss Re and Hannover Re.
Kessler pointed to a 10-year average of return on equity between 9% and 10% for Scor and a 10-year average dividend yield of 5.6% for the reinsurer.
“We have a company which grows, which is profitable. We are not in a crisis state. We do not need support from anyone. We are in a fantastic position,” he said.
In other areas of the business, Kessler said he was pleased to be the first player to issue a catastrophe bond in the London market.
He said the UK regulatory body, the Prudential Regulation Authority, had worked alongside Scor to help make it happen.
“There was a lot of goodwill. It was three, four or five times more work, but next time we are going to have the benefit. Others will benefit as well,” he said.
Despite the competitive pressures facing reinsurers, Kessler said there was continued demand from clients seeking protection.
“People are underinsured each time we have a live event. It is fantastic for the industry to say that we have the capacity to enlarge our business. It is up to us to find the solution for the client.”
However, Kessler said that one area Scor remained cautious on was cyber.
He said cyber had many different elements - such as cyber-attack, cyber-crime, data loss, fraud, products and services manipulation – which amounted to IT failure.
He said cyber was such an all-encompassing risk it was now the business of underwriters.
“You are trying to address IT failure and it is an extremely complex topic. Cyber had the potential of a nat cat, he said. “But we have made good progress on cyber protection.”