SIRC: oversupply of capital is hurting pricing

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The issue of the oversupply of capital and how it has effected pricing is a main worry for reinsurers in Asia that must be addressed, said panelists during a discussion keynote on the third day of the Singapore International Reinsurance Conference (SIRC). “Across Asia, by quite a large margin, insurers quoted that sustaining and normalising prices and excess capacity and their largest concern,” said Roshan Perera, partner at NMG Consulting, and moderator of the debate on "Reinsurance Reloaded – Asian Reinsurer Response" on the underlying concerns around the industry - especially around pricing. “Our industry is not immune to the law of supply and demand,” said Heerasing, “for 2017/18 there’s probably around $340bn in capital available, around 75% is traditional capital. If you look at 10 years ago, it was 95%, so there has been a massive influx of capital, and where it comes from has changed. I think it’s fair to say, despite some growing demand, it’s well recorded there’s now an oversupply of capital,” he said.

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