Gulbransen, the head of TigerRisk’s North America business, said he and his colleagues “are certainly seeing growth in demand and supply in the legacy space”.

Driving that, the executive told The ReInsurer, is the high degree of uncertainty that exists within the (re)insurance industry at present.

That uncertainty has arisen from the heightened catastrophe activity this year, the impact of the various convective storms on carriers’ books, issues around social inflation, civil unrest and Covid-19.

There is also uncertainty surrounding (re)insurers’ future profitability. Underwriting profitability will be harder to attain due to increased losses, low interest rates will impact investment income and, as Gulbransen noted, reserve releases have largely dried up.

“That has created greater uncertainty from a profit perspective for insurance executives and insurance companies,” Gulbransen said.

“With that has come a greater acute focus on earnings volatility and freeing up capital,” he explained.

But there are significant improvements in rates and terms and conditions within the (re)insurance market, and companies are looking to take advantage.

“Everyone is looking at the market and feeling bullish about the rate increases they’re seeing on the primary side. Some of the underwriters are saying that it’s the best market they’ve seen in a long time, and that means they want to have capital to be able to take advantage of that,” said Gulbransen.

In order to increase their capital to take advantage, Gulbransen said some carriers have secured debt, and others have raised equity.

Some, the TigerRisk executive said, have undertaken reserve transactions.

“We think that reserve transactions are a great way to release some capital that could be used prospectively. They can be highly customised, they can be quick to execute and quite cost efficient,” Gulbransen explained.

“We at Tiger have seen a lot of increase, and I think we will continue to see an increase in legacy transactions for the foreseeable future. Frankly, I think the market will continue to evolve,” he added.

The legacy market is allowing companies to manage their capital more efficiently, Gulbransen said, and he expects that more transactions in this space will arise.

“We have a dedicated team in this space and we’ve very excited about the opportunities that lie ahead,” he said.