Spiralling severe weather events and matching high insured losses are building up strong reasons to endorse high reinsurance pricing at the January 2022 renewal season.
Expected to impact on reinsurance pricing is the US Hurricane Ida with a projected loss based on early indications from modelling data by specialist ILS manager, Twelve Capital with a claim bracket of US$15bn – US25bn. Twelve Capital said information from variety of model vendors indicate that “These first early indications point towards an insured loss of around USD 15 – 25bn for insurance industry.” Another catastrophe risk specialist, Karen Clark & Company model projections for insurance and reinsurance market loss is close US$18bn. Several models said insured loss on the track of Hurricane Ida is between US$15bn to US22bn.
Flood losses across Germany and other parts of Europe, as well as other severe events across the globe this summer, according to experts create a bastion of support for improved reinsurance pricing.
For the European floods alone new estimates put losses at $11.3bn mark, and insured losses across the globe. Previous estimate of German insurance market loss was Euros 5.5bn.
The general manager of the German Insurance Association (GDV), Jorg Asmussen, said that “We are now expecting insurance losses of around seven billion euros.” A quarter of a million claims is expected, with 200,000 of those from houses, household effects and businesses. Loss data indicate that 46% of homeowners have protection against natural hazards such as heavy rain and floods. This contrasts with national coverage for nearly all buildings covered by rainstorm and hail.
This flood Artemis news blog reported, is now the most damaging natural disaster in German history, making for a particularly costly year for local insurers and those providing reinsurance capital to them.
“Together with the high hail damage in early summer, it is becoming apparent that 2021 will be one of the most expensive natural hazards years ever for insurers,” Asmussen said.
Therefore, it follows that with counting insured loss from natural catastrophes across the globe and still open ended trail of natural disasters up and until the year end, the lapping asking for reinsurance price increase in December renewals is almost certain.