AllianceBernstein reportedly estimates that alternative or third - party reinsurance capital now totals approximately $ 70bn and is expected to grow further , influencing rates and forcing reinsurers to adapt their business model . Better data and analytics , resulting in erosion of the value proposition , are also contributing to the situation . The underlying risk landscape , including a supply / demand imbalance which is why rates lower has created a need for reinsurers to offer more than just capacity , with the company starting to explore using insurance - linked securities ( ILS ) capital to accelerate diversification and reduce costs .
AllianceBernstein reportedly said that alternative or third-party reinsurance capital now totals approximately $70bn and is expected to grow further, influencing rates and forcing reinsurers to adapt their business models. Better data and analytics, resulting in erosion of the value proposition, are also contributing to the situation. The changing risk landscape, including a supply/demand imbalance which is driving rates lower has created a need for reinsurers to offer more than just capacity, with the industry starting to explore using insurance-linked securities (ILS) capital to add diversification and reduce costs.