Intermediation between cedents and reinsurers, a highly concentrated activity whose players supply not only placement but modeling, capital analysis, and structuring advice.
A reinsurance broker is not merely the party that finds capacity. Its offering has moved upstream to the point that placement has become the endpoint rather than the core. It models the cedent's catastrophe exposure, quantifies the effect of several possible structures on regulatory capital and on earnings volatility, produces the analyses that will serve as the common basis for negotiation, then organizes the placement with reinsurers and afterward handles technical account administration and claims follow-up. Two features shape the market. Concentration first: a handful of global groups intermediate most of the reinsurance placed, which gives them an aggregate view of the market that neither a cedent nor an individual reinsurer possesses. Remuneration next, historically a commission deducted from the reinsurance premium, hence paid by the reinsurer, which raises a conflict of interest question that structuring advice sharpens and that fee-based billing, growing on large accounts, seeks to defuse.
Gallagher's acquisition of Willis Re, completed in December 2021 after the Aon and Willis Towers Watson merger was abandoned, reshaped the top of the reinsurance broking market and left three dominant groups. The consequence for a cedent is concrete: choosing a broker now commits it to a set of models and a capital analysis as much as to a contact book.
reinsurance broker, intermédiation de réassurance, broking, courtage de traités