Banking & Finance

In Defense of Reinsurance (ACGL, AXS, RE, PRE, RNR, TRH, XL)

If you want to know who is ultimately on the hook for the biggest part of catastrophic losses from natural (and man-made) disasters, look no further than reinsurers.  They are on the hook for things like volcano business interruption, EU wind or flooding, Chilean earthquakes, hurricanes, and on and on.   Morningstar has decided to take a look at some of the large companies in the reinsurance space with some defense of some of its favorite names like Arch Capital Group Ltd. (NASDAQ: ACGL), Axis Capital Holdings Ltd. (NYSE: AXS), Everest Re Group Ltd. (NYSE: RE), Partner Re Ltd. (NYSE: PRE), RenaissanceRe Holdings Ltd. (NYSE: RNR), Transatlantic Holdings (NYSE: TRH), and XL Capital Ltd. (NYSE: XL).  Some of the long-term thesis coming in  is to “lay the basis for some stabilization if not firming in reinsurance rates, and improved industry return prospects in the years ahead.”

FULL ARTICLE on Morningstar.com by Bill Bergman