Share on Facebook Share on Twitter Share on Google+ Share on Linkedin Steve Eilers, Manager of Gen Re’s L.A. operation, speaks with WRIN.tv about the property facultative reinsurance market, the tropical storm season and government insurance programs. He says market conditions in the property fac market are “competitive.” Mr. Eilers says Gen Re is seeing clients take more net in treaties, which is creating opportunities in the fac market. He sees ceding companies being pushed out further into “fringes of risk”, expanding beyond their underwriting comfort. Cendents are looking for more consultation on underwriting as well. With pricing competitive, risk selection becomes even more important. Mr. Eilers believes facultative reinsurance and the E&S market “go hand in hand.” The free rate and form in the E&S segment is a natural fit for the flexibility provided by facultative property reinsurance. He agrees with findings by A.M. Best that suggest the E&S market will continue to grow. He notes that efficiency and speed of service are very important. The property market would be able to handle major large losses. Mr. V says industry capital is at all-time highs, and the premium to surplus ratio is favorable. “The industry can write the check should the event occur.” More interesting will be industry’s response post-loss. While alternative capital markets are attracted to the returns that come with volatility in the property insurance market, but the reaction to volatility after an event might be different. The major influencers of property Cat pricing going forward will depend on the occurrence of an event and the way models respond to expected risk. Models are getting better, but there are limitations. Mr. Eilers reflects on past events when unexpected large losses drove the financial impact to the industry. For more from the 2015 NAPSLO Convention, visit the WRIN.tv On Demand Library.