Internal models : a reinsurance perspective. December 2018

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      <subfield code="a">The seven members of the Insurance Europe Reinsurance Advisory Board (RAB) have a century-long experience in managing society's extreme and complex risks. Risks have changed considerably since the 19th century, when many RAB firms were established, and those risks continue to evolve today: climate change is increasing the frequency of extreme weather events; governments are under pressure to respond to the risks posed by ageing populations; and technological advances have exposed people and businesses to cyber risk.
Adapting to a rapidly changing risk landscape and identifying emerging risks lie at the heart of reinsurers' business models. Reinsurers play a crucial role in the real economy. They expand insurers' capacity to assume risks from businesses and individuals, supporting sustainable growth. By pooling a large number of diverse risks (both in terms of type and geography), reinsurers benefit from diversification, since not all risks will materialise at the same time</subfield>
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