The Risk Environment
The economic, social and legal environments present new challenges to the insurance industry in the 21st century. The impact of natural and man-made catastrophes has increased significantly. The social and legal climate has shifted the financial responsibility to those who can afford the consequences.
Competition has intensified in the insurance industry. Real-time access to information is a major contributory factor. Global financial institutions are extending their product range into traditional insurance businesses. Simultaneously, insurance buyers are demanding a broader approach to risk. As a consequence, traditional reinsurance products alone are no longer sufficient to meet insurers' needs.
Reinsurance is purchased as a strategic tool to efficiently protect and manage an insurer's balance sheet. Integrity of the balance sheet is essential in maintaining an insurer's franchise with its policyholders, and with its shareholders and potential investors, who provide the company's capital base. Balance sheet integrity is also the main focus of the rating agencies.
Hannover Re Advanced Solutions
Hannover Re adopts an all-encompassing approach which distinguishes it from the providers of traditional line-by-line reinsurance commodity products. Hannover Re Advanced Solutions focuses on the insurer's key balance sheet figures and ratios. From this base Hannover Re Advanced Solutions designs and underwrites coverages which achieve the insurer's broader objectives. Priorities have shifted to solutions which protect the entire balance sheet.