Corporate risk managers have issues with the reinsurance world that may never get addressed.
The Rendez-Vous de Septembre is the time of year when insurers and reinsurers meet in Monte Carlo to catch up, meet new contacts and deal. It's an annual event, full of all the glamour and luxury that Monaco can offer. But those not on the attendee list might wonder more about the substance of the meeting than the show.
If they were there, many risk managers might drive this substance with the questions and issues they have about reinsurers.
Thomas Hanson, director of risk management for telecom Alltel Corp., said, for instance, if he could attend Rendez-Vous, he would bring to the table the issue of transparency.
"I think eventually everything just about gets back to Lloyd's with the various Names and syndicates and so on. I just kind of like to know who these people are," he said. "I don't think there's really anything sinister happening, but sometimes it seems like it's really cloak and dagger, and you got to know the password, and the secret code, and have the decoder ring to figure everything out."
"If we can get some transparency into the treaties and the reinsurance world, I think a lot of people will feel a lot more comfortable," Hanson added, "because we'd like to know that we're not reinsured by Zimbabwe Reinsurance Ltd. or something like that."
The rest of the financial services world, on the other hand, listens to the invisible hand in the market that pushes toward automation and speed.
Risk managers of small and midsize companies, conversely, seem to be more practical, or resigned, about their place in the world of Rendez-Vous, or lack thereof.
"The only thing that we are is the customer," said Rick Vassar, corporate risk manager for midsize building services provider Valcourt Building Services. "We don't have a seat at the table."
Even risk managers at large companies hesitate to question the system as is and have faith in its inner workings. Pete Fahrenthold, managing director of risk management at Continental Airlines, said the recent price increases at reinsurance renewals are worthy of exploration.
"But I don't know that that's information that either the reinsurer or the insurer could or would share," he said. "To some extent, you have to go on just the relationships with the people you deal with and believe that they're not going to take advantage of the situation."
As for what will actually take place at the Rendez-Vous, the topic of the conference is set to be: "Are we heading toward overregulation?"
September 1, 2006
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