Are Reinsurers Really in Trouble?
Reinsurance companies, the deep pockets into which regular insurers dig when they get into trouble, were in Monte Carlo this week, and, in between speeches, were living it up in one of the world’s richest playgrounds. Of course there were a few pessimists. Fitch Ratings, whose 2009-2010 Global Reinsurance Review and Outlook says that “reinsurers may struggle to replenish capital if they suffer large catastrophe losses in the current financial market,” maintains its negative rating outlook on the whole sector. And Moody’s Investor Service, which echoes the Fitch report, says global reinsurers with weak balance sheets will have a difficult time attracting capital in the event of a big catastrophe. But A.M. Best & Co., which focuses exclusively on insurance…
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