If you are visually impaired or blind, you can visit the PDF version by Pressing CONTROL + ALT + 4
<br /> Rating ILS-Affiliated Collateralized Reinsurers<br /> Emmanuel Modu<br /> Managing Director, AM Best<br /> Dr. Wai Tang<br /> Director, AM Best<br /> April 15, 2019<br /> Agenda Items<br /> 1<br /> The ILS Universe<br /> 2<br /> Unrated Collateralized Reinsurer (Unrated CR)<br /> 3<br /> Rated Collateralized Reinsurer (Rated CR)<br /> 4<br /> The Rating Process<br /> 5<br /> Important Rating Considerations<br /> 2<br /> The ILS Universe<br /> 3<br /> The ILS Universe<br /> Recent Activities & Trends in the ILS Market<br /> The capacity provided by the ILS market is estimated to be around<br /> $98 billion<br /> • Catastrophe Bonds – approximately $30 billion1<br /> • Collateralized Reinsurance – approximately $55 billion1<br /> • Sidecars – approximately $8 billion<br /> • ILWs – approximately $5 billion<br /> 1As of June 2018; Sources: AON<br /> 4<br /> The ILS Universe<br /> Recent Activities & Trends in the ILS Market<br /> <a title="ILS_Presentation_041519_UFinal page 1" href="http://viewer.zmags.com/publication/05d711a3?page=1"> Rating ILS-Affiliated Collateralized Reinsurers </a> <a title="ILS_Presentation_041519_UFinal page 2" href="http://viewer.zmags.com/publication/05d711a3?page=2"> Agenda Items 1 The ILS Universe 2 Unrated Colla</a> <a title="ILS_Presentation_041519_UFinal page 3" href="http://viewer.zmags.com/publication/05d711a3?page=3"> The ILS Universe 3</a> <a title="ILS_Presentation_041519_UFinal page 4" href="http://viewer.zmags.com/publication/05d711a3?page=4"> The ILS Universe Recent Activities & Trends in t</a> <a title="ILS_Presentation_041519_UFinal page 5" href="http://viewer.zmags.com/publication/05d711a3?page=5"> The ILS Universe Recent Activities & Trends in t</a> <a title="ILS_Presentation_041519_UFinal page 6" href="http://viewer.zmags.com/publication/05d711a3?page=6"> The ILS Universe Recent Activities & Trends in t</a> <a title="ILS_Presentation_041519_UFinal page 7" href="http://viewer.zmags.com/publication/05d711a3?page=7"> Unrated CR 7</a> <a title="ILS_Presentation_041519_UFinal page 8" href="http://viewer.zmags.com/publication/05d711a3?page=8"> Unrated CR Collateralized Reinsurer Cedant1 Rein</a> <a title="ILS_Presentation_041519_UFinal page 9" href="http://viewer.zmags.com/publication/05d711a3?page=9"> Unrated CR Simplified Unrated Collateralized Rei</a> <a title="ILS_Presentation_041519_UFinal page 10" href="http://viewer.zmags.com/publication/05d711a3?page=10"> Rated CR 10</a> <a title="ILS_Presentation_041519_UFinal page 11" href="http://viewer.zmags.com/publication/05d711a3?page=11"> Rated CR Newco Re – The Newly Rated Entity Seve</a> <a title="ILS_Presentation_041519_UFinal page 12" href="http://viewer.zmags.com/publication/05d711a3?page=12"> Rated CR Examples of ILS-Affiliated Collateraliz</a> <a title="ILS_Presentation_041519_UFinal page 13" href="http://viewer.zmags.com/publication/05d711a3?page=13"> Rated CR Newco Re –the Newly Rated Entity (Commo</a> <a title="ILS_Presentation_041519_UFinal page 14" href="http://viewer.zmags.com/publication/05d711a3?page=14"> Rated CR Common Business Model Interaction of t</a> <a title="ILS_Presentation_041519_UFinal page 15" href="http://viewer.zmags.com/publication/05d711a3?page=15"> T he Rating Proce ss 15</a> <a title="ILS_Presentation_041519_UFinal page 16" href="http://viewer.zmags.com/publication/05d711a3?page=16"> The Rating Process Main Methodology: </a> <a title="ILS_Presentation_041519_UFinal page 17" href="http://viewer.zmags.com/publication/05d711a3?page=17"> The Rating Process The Building Block Approach* </a> <a title="ILS_Presentation_041519_UFinal page 18" href="http://viewer.zmags.com/publication/05d711a3?page=18"> The Rating Process Balance Sheet Strength: BCAR </a> <a title="ILS_Presentation_041519_UFinal page 19" href="http://viewer.zmags.com/publication/05d711a3?page=19"> The Rating Process Balance Sheet Strength: BCAR </a> <a title="ILS_Presentation_041519_UFinal page 20" href="http://viewer.zmags.com/publication/05d711a3?page=20"> The Rating Process Balance Sheet Strength: BCAR </a> <a title="ILS_Presentation_041519_UFinal page 21" href="http://viewer.zmags.com/publication/05d711a3?page=21"> The Rating Process Balance Sheet Strength: BCAR A</a> <a title="ILS_Presentation_041519_UFinal page 22" href="http://viewer.zmags.com/publication/05d711a3?page=22"> The Rating Process Balance Sheet Strength • Po</a> <a title="ILS_Presentation_041519_UFinal page 23" href="http://viewer.zmags.com/publication/05d711a3?page=23"> The Rating Process Operating Performance • Pos</a> <a title="ILS_Presentation_041519_UFinal page 24" href="http://viewer.zmags.com/publication/05d711a3?page=24"> The Rating Process Business Profile • Positiv</a> <a title="ILS_Presentation_041519_UFinal page 25" href="http://viewer.zmags.com/publication/05d711a3?page=25"> The Rating Process ERM • Positives – P</a> <a title="ILS_Presentation_041519_UFinal page 26" href="http://viewer.zmags.com/publication/05d711a3?page=26"> I mportant Ratin Considerations g </a> <a title="ILS_Presentation_041519_UFinal page 27" href="http://viewer.zmags.com/publication/05d711a3?page=27"> Important Rating Considerations Form of Capital </a> <a title="ILS_Presentation_041519_UFinal page 28" href="http://viewer.zmags.com/publication/05d711a3?page=28"> Important Rating Considerations Tail Risk Rated </a> <a title="ILS_Presentation_041519_UFinal page 29" href="http://viewer.zmags.com/publication/05d711a3?page=29"> Important Rating Considerations Tail Risk (cont’</a> <a title="ILS_Presentation_041519_UFinal page 30" href="http://viewer.zmags.com/publication/05d711a3?page=30"> Important Rating Considerations Type of Business</a> <a title="ILS_Presentation_041519_UFinal page 31" href="http://viewer.zmags.com/publication/05d711a3?page=31"> Important Rating Considerations Type of Business</a> <a title="ILS_Presentation_041519_UFinal page 32" href="http://viewer.zmags.com/publication/05d711a3?page=32"> Important Rating Considerations Degree of Alignm</a> <a title="ILS_Presentation_041519_UFinal page 33" href="http://viewer.zmags.com/publication/05d711a3?page=33"> Important Rating Considerations Cedants Underwr</a> <a title="ILS_Presentation_041519_UFinal page 34" href="http://viewer.zmags.com/publication/05d711a3?page=34"> Important Rating Considerations Significant Agre</a> <a title="ILS_Presentation_041519_UFinal page 35" href="http://viewer.zmags.com/publication/05d711a3?page=35"> Important Rating Considerations Availability of </a> <a title="ILS_Presentation_041519_UFinal page 36" href="http://viewer.zmags.com/publication/05d711a3?page=36"> Important Rating Considerations Rating Constrain</a> <a title="ILS_Presentation_041519_UFinal page 37" href="http://viewer.zmags.com/publication/05d711a3?page=37"> Important Rating Considerations Results of Stres</a> <a title="ILS_Presentation_041519_UFinal page 38" href="http://viewer.zmags.com/publication/05d711a3?page=38"> Important Rating Considerations Fund Liquidity (</a> <a title="ILS_Presentation_041519_UFinal page 39" href="http://viewer.zmags.com/publication/05d711a3?page=39"> Important Rating Considerations Reinsurance Reco</a> <a title="ILS_Presentation_041519_UFinal page 40" href="http://viewer.zmags.com/publication/05d711a3?page=40"> Contact Information Emmanuel Modu Managing Dire</a> <a title="ILS_Presentation_041519_UFinal page 41" href="http://viewer.zmags.com/publication/05d711a3?page=41"> Appendix 41</a> <a title="ILS_Presentation_041519_UFinal page 42" href="http://viewer.zmags.com/publication/05d711a3?page=42"> Buffer Loss Factor Table Example of a Buffer Lo</a> <a title="ILS_Presentation_041519_UFinal page 43" href="http://viewer.zmags.com/publication/05d711a3?page=43"> Surveillance Requirements • Surveillance requir</a>