Life and health reinsurance 

Reinsurance is commonly used by life and health insurers to manage their profitability, risk, and capital, and to access services provided by third-party reinsurers. The Life and Health Reinsurance Working Party was established in 2014 and has since set itself the ambition of developing into a source of practical knowledge and expertise on matters relating to reinsurance. Rather than looking at the theory behind reinsurance, the working party has been focused on the value that reinsurance can provide across the insurance industry. 

Reinsurance is a very common and indeed powerful tool that insurers can use in many parts of the organisation. It is used for a variety of reasons, including risk management, capital management, access to technology and services, and alternative asset strategies. And more. 

Ultimately, the purpose of an insurer is to help its policyholders manage their own uncertain future financial risks. It does so by taking on those risks, pooling them to achieve diversification, and earning a return on the capital required to back the business. 

To this end, the reinsurance strategy and framework of any insurer may have a significant impact on its ultimate performance, its business and risk profile, its capital position, and its ability to remain solvent and grow, and thus continue to meet its policyholders’ needs well into the future. 

However, as a working party, we believe that reinsurance is not always optimised to support an insurer’s objectives, and may even destroy value through poor design and implementation. 

Chair: Greg Solomon 

Established: 2014