1. Pierre Laurin

2. Reinsurance Buying Process
Very centralized approach
Subject to overall goals and direction
Very formalized process
Get our authorities from Group Reinsurance Committee, then from ZNA’s Reinsurance Charter, then to ZNA’s Reinsurance Sub-committee
Security Committee
Business Units do not have the authority to purchase reinsurance treaties
Very strict approved list of reinsurers

3. Structure of team Two major teams:
Marketing team responsible to market management, internal and external
Underwriting team responsible for reviewing, underwriting, and approving purchase of treaties

4. Marketing team Client relationship – Internal Clients External Client
General discussions on needs and objectives of the BUs
Data gathering
Creation of submission, narrative
Market the transaction and placement of treaty
External Client
Market management
Broker selection, when needed
Contact with reinsurers

5. Underwriting Team Responsible to underwrite and approve treaties
Help design treaty structure, with regards to goals and objectives
Help Marketing team to put best presentation forward
Review submission from a reinsurer’s perspective
Underwrite program
Participate in claims and underwriting audits
Benchmark pricing from the actuarial team
Set retention, inclusive of co-participation
Help marketing in setting firm order terms and conditions
Design contract according to standard clauses

6. Placement philosophy Prefer Excess of Loss
Typically, high retentions with co-participation in upper layers
Co-participation is preferred to eliminating layers altogether
Keep markets involved
Allows for market pricing
More flexibility in placement
Prefer large treaties with economy of scale with panel of reinsurers
Reinsurers prefer smaller treaties with targeted portfolios, small number of reinsurers preferred
Need to reconcile the two opposite needs.

7. Placement Philosophy Contracts Two sections of contracts
Signed within 90 days
Initial contract with submission
Final contract with firm order terms
Two sections of contracts
Business terms
Standard clauses

8. Placement Process Total 9 month process
180 days -> review of goals and objectives
150 to 120 days -> data collection, loss experience and BU underwriting reviews
90 days -> account manager review of data, narratives, start of building of submission, contact with markets on goals and objectives, initial wording
60 days -> reinsurance underwriting reviews, data analysis and pricing benchmarking, discussions with markets
45 days -> submission out to market

9. Placement Process Total 9 month process (cont’d)
30 days -> Negotiations with markets, finalization of benchmarking, contract wording, final review of markets against approved list
15 days -> firm order terms with final contracts, receive authorization, sign lines
0 -> transaction completed
+7 days -> internal notification, accounting systems feed
+ 15 days -> issuance of I&Ls, premium allocation between units
+30 to 90 days -> contracts signed, close final issues, take remedial action on non-performing reinsurers

10. Summary Very formalized process
Very technical with involvement of underwriters, actuaries, marketing, BUs management
Successful in achieving our goals
Process never stops