Reinsurance in Ireland: Development and Issues

Ireland has the second-highest number of reinsurance companies in Europe, with its asset size corresponding to over 30 per cent of GDP. The Irish reinsurance industry plays a significant role in the global market. Using aggregated company-level data, the contribution of reinsurance to the Irish economy is shown to be relatively low compared with other insurance businesses. This article examines factors which contribute to reinsurance companies locating in Ireland, and attempts to review the potential implications for the reinsurance industry from the introduction of the new EU regulatory framework, Solvency II. The financial stability considerations arising from the location of these companies in Ireland are also explored.