Swiss Re Says New Reinsurance Capital Not Posing Systemic Risk
This article is for subscribers only.
Swiss Re Ltd., the world’s No. 2 reinsurer, doesn’t see near-record capital inflows to the reinsurance market from new investors such as pension funds causing systemic risk.
“If you detach the actual risk takers too much from those who understand it, I think there is a risk, but so far it’s very limited,” Christian Mumenthaler, head of Swiss Re’s reinsurance business, said in an interview in Monte Carlo yesterday. “If there is a big loss, pension funds would have an invisible hit as they only allocate a very small fraction of their capital, so I can’t see a systemic component.”