3.3.6Segment

Reinsurance

Reinsurance companies providing risk transfer solutions to primary insurance carriers on a treaty or facultative basis.

4
Verticals

Overview

Reinsurance provides risk-transfer solutions to primary insurers on a treaty or facultative basis, led by global reinsurers (Munich Re, Swiss Re, Hannover Re, Berkshire) and the Bermuda market. It absorbs catastrophe and large-loss risk from primary carriers, making it central to the system's capacity.

Rates hardened sharply after years of catastrophe losses, restoring profitability and attracting capital, including insurance-linked securities and alternative capital. It is a consolidated, capital-intensive, globally concentrated market.

Market snapshot

Market size
~$99B
Growth
~8.2%CAGR (2017–22, nominal)
Companies
~177 firms
Firms by employee count

68.4% of firms have fewer than 20 employees: 121 micro-businesses, below most mandates.

The investable universe56 firms with 20+ employees
20–99
1730%
100–499
1527%
500+
2443%

The system's shock absorber — global reinsurers (Munich Re, Swiss Re, Hannover Re, Berkshire) and the Bermuda market take catastrophe and large-loss risk off primary carriers. Rates hardened sharply after years of catastrophe losses, restoring profitability and pulling in capital, including insurance-linked securities and other alternative capital. A consolidated, capital-intensive, globally concentrated market; revenue is reinsurance premiums.

NAICS 524130. U.S. Census Bureau — 2022 Statistics of U.S. Businesses; U.S. Census Bureau — 2022 Economic Census.

Business model & economics

Revenue model

Reinsurance premiums against ceded losses, plus investment income

Key economics

Revenue per firm
$557,886,554
Employees per firm
79.5
Recurring revenue
High

renewing treaty relationships

EBITDA margin
Combined-ratio-driven; catastrophe-exposed
Capex intensity
Low

Characteristics

  • Scale-driven — payroll is only 3% of revenue; the cost base is assets, not headcount
  • Thin strategic-buyer pool — only 24 firms exceed 500 employees; exits skew sponsor-to-sponsor
  • Absorbs catastrophe and large-loss risk from primary carriers.
  • Rates hardened after years of catastrophe losses.
  • Alternative capital (ILS) supplements traditional capacity.

NAICS 524130. U.S. Census Bureau — 2022 Statistics of U.S. Businesses; U.S. Census Bureau — 2022 Economic Census.

M&A deal context

Deal activityModerate

Who’s acquiring

  • Global reinsurers
  • Bermuda & alternative-capital platforms
  • Insurance-linked-securities investors

What’s driving deals

  • Hardening rates restoring profitability.
  • Alternative capital and ILS growth.
  • Catastrophe-driven capacity dynamics.

Verticals in this segment

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