Inreon sees limited deal volumes
Online trading platform Inreon has seen a number of transactions completed on its internet-based reinsurance trading platforms, but volumes have been muted, with a total value of $30,000 to $600,000 (inreon declined to provide specific figures) through five or six deals having been fulfilled online in the last three months.
While activity has been limited compared with the market in general - a large reinsurer would typically work on about 500 deals at a time - an inreon spokesperson claimed the company is happy with activity to date. "We are on track compared to where we wanted to be. We, and the clients, are gaining experience and improving the system. And we expect volumes to grow."
Inreon, set up in December 2000, saw its first proposed risk deal posted in June this year. So far the company has 10 brokers and 12 primary companies in four different countries dealing through its platform. It currently has nine reinsurers on board, with around 15 buyers using the system.
Management believes activity will grow as the advantages of internet-based trading becomes more widely realised. "Internet transactions will cut down on the administration costs associated with reinsurance transactions. Currently administration costs can be as high as 30% of the overall premium. Dealing online could reduce this by up to 50%," the spokesperson claimed.
Reinsurers accepting business through inreon have to pay a fee for using the platform but are able to benefit through the increased distribution channels. Buyers themselves have the advantage of being able to deal with a broad range of reinsurers. "Inreon provides reinsurance buyers with a unique platform to access reinsurance capacity on a global basis," said Rob Bredahl, inreon chief executive.
At present reinsurers only offer facultative property contracts on inreon. These are single policies rather than treaty reinsurance contracts that cover portfolios of multiple policies, which generally command higher margins.
Inreon said it plans to roll out a wider range of products sometime later this year.
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe
You are currently unable to print this content. Please contact info@risk.net to find out more.
You are currently unable to copy this content. Please contact info@risk.net to find out more.
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Printing this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@risk.net
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Copying this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@risk.net
More on Risk management
Clear warning on escape hatch for optimisation trades
CCPs fear Emir clearing mandate carve-out for portfolio rebalancing could be abused
One year on, regulators still want a cure for bank runs
Broad support for higher outflow assumptions on uninsured deposits, but that won’t save insolvent banks
Falling T2 balances bode well for eurozone’s stability
Impact of fragmentation would be less severe today than in 2010s, says Marcello Minenna
For a growing number of banks, synthetics are the real deal
More lenders want to use SRTs to offload credit risk, but old hands say they have a long road ahead
Did Fed’s stress capital buffer blunt CCAR?
Experts fear flagship test’s use as a capital top-up has undermined its role in risk management
How Ally found the key to GenAI at the bottom of a teacup
Risk-and-tech chemistry – plus Microsoft’s flexibility – has seen US lender leap from experiments to execution
Industry urges focus on initial margin instead of intraday VM
CPMI-Iosco says scheduled variation margin is better than ad hoc calls by clearing houses
Consortium backs BGC’s effort to challenge CME
Banks and market-makers – including BofA, Citi, Goldman, Jump and Tower – will have a 26% stake in FMX
Most read
- Breaking out of the cells: banks’ long goodbye to spreadsheets
- Basel Committee reviewing design of liquidity ratios
- Too soon to say good riddance to banks’ public enemy number one