Guy Carpenter’s Jeff Krohn on Mortgage Credit Risk Transfer

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In this video interview with Insurance Insider concurrent with the 2023 Monte Carlo Rendez-Vous, Guy Carpenter’s Jeff Krohn, Mortgage Credit Segment Leader, discussed conditions around the credit risk transfer segment and how the market could change going forward.

“2022 was an incredible year, an incredible moment for the reinsurance industry,” Jeff explained. “The credit risk transfer market transferred USD 18 billion of risk to the reinsurance market. A record year, and the reinsurance market picked up share over the capital markets.”

However, the market is seeing some changes this year, Jeff continued.

“2023 is turning out a little differently. Part of that is a function of the USD 18 billion that was laid off to the reinsurance industry last year,” Jeff said. “Their in-force portfolios aren’t amortizing as quickly because mortgages are staying in these reference pools longer, as the interest rates have increased.”

Click image below to watch the video