Striking the Balance
Assuming and managing capital markets risks can enhance the operating and strategic efficiency of a reinsurer. The skills, philosophy and technology that lead to good investment management are complementary to those required to succeed in reinsurance. Combining the two in a single organization enhances the ability of the reinsurer to generate superior risk-adjusted returns. The most successful reinsurers will be those that find a prudent balance between capital markets risk and traditional reinsurance.
Long-term success in the business of risk depends on having people with the experience, underwriting knowledge and technical expertise to manage risk in whatever form it presents itself – whether through traditional reinsurance or the capital markets. Our ability to apply our skills to diversified risks reduces volatility, strengthens our financial position and ensures capacity for our clients well into the future.
Marvin Pestcoe
Head of Private Markets, Capital Markets
Ted Dziurman
Head of Catastrophe
Nick Giuntini
Chief Risk and Financial Officer, Capital Markets
John Davidson
Chief Economist, Capital Markets
Franck Pinette
Head of Life
Dom Tobey
Head of Risk Management & Reserving, Global
The vision of PartnerRe is to be an intelligent provider of risk assumption products. We remain first and foremost a reinsurance company, providing valuable capacity to our clients, so we will continue to allocate capital with a priority to our reinsurance operations. However, the decreased potential for diversification – our primary risk management tool – within the reinsurance market is of concern to us. So we are open to exploring the assumption of other forms of risk, such as capital markets risk, that provides non-correlated diversification, enhances our return on risk capital and reduces volatility within our portfolio.
Our approach is methodical within a clearly defined strategy around risk limits. First, we have a diversified portfolio of risk, with a portion of our capital exposed to capital markets risks. Second, we will continue to approach capital markets risk in essentially the same way we approach reinsurance risk, using limits and controls, diversifying across asset classes and geographies and focusing on fundamental value. Finally, we review, evaluate, value and manage the risk ourselves, not through a third party.
Taking on more capital markets risk is a natural evolution for our Company. By building teams of experts focused on single asset classes, and taking a phased, risk-limited approach, we will achieve further diversification within a well-managed framework. Next >