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Gallagher Re says alternative and traditional reinsurance capital are now blended

The broker said clients are increasingly focused on optimizing how to finance risk over the next three to five years, not just where capital comes from.

Reported · Written up by our desk · Reinsurance

During Gallagher Re’s Pre-Monte Carlo Media Briefing, the firm said alternative insurance capital is no longer being discussed separately from traditional reinsurance, and is now part of the broader capital stack. Will Thompson, Gallagher Re’s Head of Global Clients, said clients have access to a wider set of capital solutions than at any point in the reinsurance industry’s history.

Thompson said traditional reinsurance still remains critical, but that it now sits alongside instruments including catastrophe bonds, sidecars, collateralised reinsurance vehicles, and other bespoke capital arrangements. He added that clients are increasingly evaluating these options together for renewals, rather than treating them as distinct markets.

Artemis reports Thompson described a shift from earlier views that alternative capital was mainly used when traditional capacity was constrained or expensive. He said the current discussion centers on the most efficient structure for renewals and, more broadly, the most efficient way to finance the underlying risk over the next three to five years.

Gallagher Re President Andrew Newman said clients are becoming less concerned about the origin of capital and more focused on what that capital can do. He said the key conversation has moved from simply obtaining capital to optimizing it based on factors including flexibility, structure, duration, and strategic value.

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