Mr. Roberts: Max Capital Group Ltd. is a global specialty insurance and reinsurance company that offers many different property and casualty product lines, in addition to some life reinsurance. We started underwriting in 2000 when we were a Bermuda reinsurance company primarily focused on alternative business. Since that time, however, and as the market has changed, we have transitioned into a more traditional insurance and reinsurance company. We still operate principally out of Bermuda, but have very significant operations in both Ireland and the US.
TWST: You said the market has changed. What were the changes?
Mr. Roberts: When we started in 2000, underwriting conditions were difficult and
we had a period of soft or lower pricing in the insurance and reinsurance
industry. And, as we say in our business, you weren't paid enough to take a lot
of risks at those times, so we initially concentrated on larger transactions
that transferred less underwriting risk than in traditional reinsurance
arrangements, but which enabled us to benefit from the growth of our invested
assets. After the World Trade Center tragedy in 2001 and the related insurance
losses, market conditions changed dramatically, with the cost of buying
insurance increasing significantly. We refer to this phenomenon as a "hardening"
of the market. The results of this hardening included better terms and
conditions for sellers of insurance and, hence, potentially enhanced
profitability. Inevitably this attracted new capital into the insurance and
reinsurance market to take advantage of those opportunities.
Tickers included in this excerpt: MXGL
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