The trends impacting insurance and reinsurance companies are typically aligned, but sometimes the trends push and pull in an opposing (but complementary) way. Current forces in the insurance industry are pushing many insurers to simplify their products and channels, while at the same time those forces are having the opposite impact in reinsurance, pulling away from simplicity and towards more complex reinsurance contracts. We'll get into this in more detail, but first we need to look at the three major areas of disruption in the global insurance and reinsurance industry: capital and regulation, competition, and technology.

Capital and regulation

Large parts of the world are awash with capital looking for a place to be reinvested. This includes a large increase in alternative capital (ex. Diversified pension funds, endowments). Diversified capital allocation models are guiding where the money is going. Alternate capital is both a threat and an opportunity to reinsurers. While alternate capital sources can result in additional (and less regulated) competition for reinsurers, it's also an opportunity for smaller reinsurers to partner up with these larger alternate funds, giving them access to business they wouldn't have had before.