MONTE CARLO, 8 September 2013 – Aon Benfield, the global reinsurance intermediary and capital advisor of Aon plc (NYSE:AON), today releases the September 2013 edition of its flagship Reinsurance Market Outlook report, which provides a comprehensive analysis of the key variables affecting buyers of reinsurance as they approach the 1/1 renewals.

The report, entitled 'Post Convergence: The Next USD100 Billion', reveals how insurers and reinsurers will benefit from the next, and much more transformative, USD100 billion of alternative capital that will enter the reinsurance business over the next five years. The value proposition of reinsurance will improve as the cost of underwriting capital is reduced for reinsurers. The post-convergence market brings unlevered collateralized products that are more accretive to insurers than traditional reinsurance for peak risks.

Reinsurers in the post-convergence market will innovate their capital structures to incorporate the additional USD100 billion of alternative capital flows. Reinsurers will engage in three broad categories of transactions with investors:

1. insurance-linked securities (ILS or cat bonds) to lower the cost of underwriting capital supporting peak tail risks;
2. sidecars to lower the cost of underwriting capital across the portfolio risk spectrum, and
3. formation of asset management divisions that will allow reinsurers the opportunity to accept asset management mandates from investors.

Bryon Ehrhart, Chairman of Aon Benfield Analytics, said: "The benefits of this new capital will begin to extend beyond property catastrophe and mortality risks that are common features of the current ILS market and extend into many other reinsurance lines where loss frequency and severity are more predictable."

Commenting on the upcoming renewal season, he commented: "The January 1 renewal market for our clients will benefit materially from an excess of traditional reinsurance capacity and new alternative capital flows over light demand growth for reinsurance capacity. Our clients should expect to benefit from a competitive market even if a moderate hurricane season should develop."

Download the report here: http://bit.ly/1fD4bXt

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About Aon Benfield

Aon Benfield, a division of Aon plc, is the world’s leading reinsurance intermediary and full-service capital advisor. We empower our clients to better understand, manage and transfer risk through innovative solutions and personalized access to all forms of global reinsurance capital across treaty, facultative and capital markets. As a trusted advocate, we deliver local reach to the world’s markets, an unparalleled investment in innovative analytics, including catastrophe management, actuarial and rating agency advisory. Through our professionals’ expertise and experience, we advise clients in making optimal capital choices that will empower results and improve operational effectiveness for their business. With more than 80 offices in 50 countries, our worldwide client base has access to the broadest portfolio of integrated capital solutions and services. To learn how Aon Benfield helps empower results, please visit aonbenfield.com.

About Aon

Aon plc (NYSE:AON) is the leading global provider of risk management, insurance and reinsurance brokerage, and human resources solutions and outsourcing services. Through its more than 65,000 colleagues worldwide, Aon unites to empower results for clients in over 120 countries via innovative and effective risk and people solutions and through industry-leading global resources and technical expertise. Aon has been named repeatedly as the world’s best broker, best insurance intermediary, reinsurance intermediary, captives manager and best employee benefits consulting firm by multiple industry sources. Visit www.aon.com for more information on Aon and www.aon.com/manchesterunited to learn about Aon’s global partnership and shirt sponsorship with Manchester United.