Companies in this industry provide insurance to other insurance companies to assume the risk on existing policies as a hedge against catastrophic loss. Major companies include Reinsurance Group of America (RGA), Everest Re, and TransRe (all based in the US), as well as Munich Re (Germany), Swiss Re (Switzerland), and SCOR (France).
Demand is driven by the volume of insurance policies written and the size of insurance companies' risk portfolios. The profitability of individual companies depends on the ability to balance premium and investment income against claim payouts. Large companies have advantages in serving customers in diverse geographic areas and product categories. Smaller companies can compete effectively by providing coverage for specialized insurance markets. The US industry is highly concentrated: the top 20 companies account for about 85% of revenue.
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Reinsurance companies typically assume all or part of the risk associated with property/casualty, medical, life, and other types of insurance policies originally underwritten by other insurance companies. Premiums assumed from property/casualty reinsurance account for about 55% of US industry revenue. Life and health reinsurance, which accounts for about 35% of revenue, includes whole, term, and universal life policies; annuities; and group and individual health care coverage.