Re-ins. players scale back coverage in the region to hedge against conflict escalation

The ins. industry is adapting to a new and more volatile region:Global re-ins. firms have begun inserting get-out clauses into their policies to hedge against the potential of a full-scale Middle East conflict, writes the Financial Times, citing four industry insiders. Local insurers under the new contracts will lose their reinsurance coverage for any newly underwritten asset in the event of the clause being triggered.

Expect to claim less for more:To make matters worse for insurers, re-insurers are also upping prices and pressuring primary insurers in Lebanon, Jordan, and Israel to cap coverage — which in tandem with the get-out clauses make doing business in the region riskier and costlier than it previously was.

ALSO WORTH MENTIONING-

Citigroup to slash nearly 10% of its workforce: Citigroup will cut 20k jobs over the medium term in a bid to save up to USD 2.5 bn and boost the struggling US bank’s returns. (Earnings presentation,pdf)

THE CLOSING BELL-

The EGX30 rose 1.8% at yesterday’s close on turnover of EGP 4 bn (18.2% above the 90-day average). Local investors were net sellers. The index is up 4.3% YTD.

In the green: Credit Agricole (+6.4%), TMG Holding (+6.0%), and Mopco (+5.0%).

In the red: B Investments (-1.8%).

Asian markets sagged at the opening bell but have since recovered and are cautiously in the green as investors digest Taiwan’s election results on the first day of trading this week. European benchmarks look uniformly set to open in the green later this morning, while the Dow, S&P, and Nasdaq are all flirting with the red.