Swiss Re expects rise in demand and prices to continue driven by increasing exposures and risk

Swiss Re Ltd / Key word(s): Market Report Swiss Re expects rise in demand and prices to continue driven by increasing exposures and risk 12.09.2022 / 07:00 CET/CEST Uncertain economic and geopolitical environment leads to increasing risks and demand for insurance protection Despite challenging backdrop, Swiss Re sees growth opportunities and is well positioned to support clients with its strong balance sheet and risk capacity Rate hardening is expected to reflect higher risks and growing demand Zurich, 12 September 2022 – Global geopolitical tensions, macroeconomic developments and climate change result in heightened demand for risk protection. The re/insurance industry needs to focus on modelling and contract certainty to ensure pricing is adequate for the risks taken and thereby increasing its capacity. Swiss Re supports clients with its risk knowledge, capital strength and innovative solutions. Ahead of the Rendez-Vous de Septembre 2022, Swiss Re today shares its view on the state of the market and possible implications for the renewals season. Swiss Re's Chief Executive Officer Reinsurance, Moses Ojeisekhoba, said: "On top of impacts from COVID-19 and increasing losses from natural catastrophes, the re/insurance industry is now confronted with issues like inflation, risk of recession and geopolitical tensions. We have proven our resilience by supporting clients and society throughout the last years by paying large insurance claims. As we see cost drivers accelerating in this dynamic risk environment, insurance premiums must be carefully calibrated to keep pace." Growth opportunities despite challenging environment Geopolitical tensions, inflationary pressures and knock-on effects such as energy shocks, cyber threats and supply chain disruptions pose challenges for society and ultimately the re/insurance industry. In addition, climate change is increasingly manifesting itself with no end in sight. At the same time there are significant opportunities to hedge this volatile environment with insurance solutions. Increased risk awareness and exposures will result in more demand for insurance protection across all businesses and regions, translating into a positive outlook for premiums. For instance, Swiss Re Institute expects a USD 33 billion increase in commercial premium volumes in the period from 2022 to 2026 as a result of supply chain reshoring. And if countries deliver on building all the renewable energy capacity that they have so far targeted, the investments in green energy are expected to generate additional energy-sector related premiums of USD 237 billion by 2035. Swiss Re intends to further grow and diversify its natural catastrophe portfolio. The natural catastrophe re/insurance market is forecast to grow to about USD 48 billion over the next four years from USD 35 billion according to Swiss Re Institute. The market needs to keep up with growing loss trends and develop modelling capabilities for weather-related risks such as secondary perils. Swiss Re, with its proprietary models and significant natural catastrophe research team of 50 natural scientists and engineers, is well positioned to offer natural catastrophe solutions to better navigate existing market conditions. Disciplined underwriting approach is key The uncertain environment calls for more frequent adjustments to underwriting practices. Focusing on quality and margins as well as contractual clarity in the whole industry will be key in this respect. Swiss Re's Group Chief Underwriting Officer Thierry Léger said: "To enable the insurance industry to keep up with increasing demand, three factors will be key: evaluating and modelling the evolving trends, ensuring a shared understanding of contractual terms and generating improved technical margins to reflect the effective risk." Swiss Re continuously reviews and updates its underwriting models to incorporate new learnings, improved scientific understanding and additional loss experience to reflect the risks clients will be confronted with and to offer the coverage needed. It is collaborating with leading universities such as the Massachusetts Institute of Technology (MIT), ETH Zurich, Berkeley and the Swiss Federal Institute of Technology Lausanne (EPFL) to address the latest machine learning techniques to enhance its predictive models. Swiss Re's Chief Executive Officer Reinsurance Moses Ojeisekhoba said: "In times like these, when challenges manifest themselves in the form of heightened risks, we at Swiss Re are well positioned to navigate these turbulent times together with our clients. By leveraging our risk knowledge, capital strength and client franchise, and providing innovative solutions we continue to create value for our clients. This is supported by our leading data and analytics capabilities, which will play a key role for future success." For further information please contact Swiss Re Media Relations: + 41 (0)43 285 7171 or [e-mail]. Please use this link to access the Swiss Re website. Swiss Re The Swiss Re Group is one of the world’s leading providers of reinsurance, insurance and other forms of insurance-based risk transfer, working to make the world more resilient. It anticipates and manages risk – from natural catastrophes to climate change, from ageing populations to cyber crime. The aim of the Swiss Re Group is to enable society to thrive and progress, creating new opportunities and solutions for its clients. Headquartered in Zurich, Switzerland, where it was founded in 1863, the Swiss Re Group operates through a network of around 80 offices globally. Cautionary note on forward-looking statements Certain statements and illustrations contained herein are forward-looking. These statements (including as to plans, objectives, targets, and trends) and illustrations provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to a historical fact or current fact. Further information on forward looking statements can be found in the Legal Notice section of Swiss Re's website. End of Media Release

Language:	English
Company:	Swiss Re Ltd
	Mythenquai 50/60
	8022 Zurich
	Switzerland
Phone:	[phone]
E-mail:	[e-mail]
Internet:	www.swissre.com
ISIN:	CH0126881561
Valor:	12688156
Listed:	SIX Swiss Exchange
EQS News ID:	1439797

End of News	EQS News Service

1439797  12.09.2022 CET/CEST