Barring hurricanes or other catastrophes for the remainder of this year, the reinsurance financial strength forecast for 2007 remains stable, with cycle management being the top concern, according to rating agencies gathered here.
The reinsurance sector has proved to be resilient to the storms of 2005, while "only suffering a limited number of downgrades," reported Chris Waterman, senior director at Fitch Ratings in London.
Overall, he said, "we see the catastrophe season last year as more of an earnings issue in the reinsurance market, rather than a capital issue. Those few reinsurers that did suffer capital erosion were able to rebuild their balance sheets quite quickly." He added that "paradoxically, the reinsurance sector is probably in a better position today than it was before the storms."
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