London-listed property and casualty insurer Catlin yesterday said it planned to set up a new venture in Switzerland to boost its presence in the European reinsurance market.
Bermuda-based Catlin will provide the new operation, Catlin Re Switzerland, with capital reserves of at least $1bn (£662m). Catlin said the new venture would allow it to benefit from a future cyclical improvement in European reinsurance prices, currently under pressure in most market segments because of intense competition.
The company also aims to pick up extra business as the European Union’s strict Solvency II capital regime for insurers, which comes into force in 2013, forces some smaller European players to retrench.
“Our ambition is to build Catlin Re Switzerland over time to become a leading European specialty reinsurer,” Catlin chief executive Stephen Catlin said in a statement.
Catlin’s new venture mirrors a move two months ago by British rival Amlin to tap into the European reinsurance market through a dedicated Swiss-based subsidiary, staffed by a team of underwriters recruited from reinsurance giant Swiss Re.
Lloyd’s of London insurer Novae last year also set up a reinsurance unit, targeting the European market from offices in London and Zurich. The dominance of major European reinsurers such as Swiss Re and Munich Re means European reinsurance business is often inaccessible to companies operating only in the Lloyd’s of London market. Catlin Re Switzerland will take over and develop the book of reinsurance policies written by Catlin’s existing network of 10 European offices, the company said.
City A.M. Reporter