^aAXIS Capital Holdings Ltd, Chesney House, 1st Floor, 96 Pitts Bay Road, Pembroke HM 06, Bermuda.

Correspondence: Michael Butt, E-mails: michael.butt@axis.bm, blythe.hurney@axiscapital.com

Abstract

The convergence and interplay between the insurance sector and the capital markets is likely to increase as will the diversity of products the capital markets offer. The speed and depth of this increase will depend on the ability of the insurance sector to improve its data quality and its risk management practices, and the number and size of large losses in the next several years as the markets develop their knowledge. Ultimately, those insurers who have the best data collection and control will have a competitive edge in leveraging their own risk management franchises for stakeholders.