Archive for September, 2017

The potential impact of major hurricane Irma, which now has Category 3 status and 130 mph+ winds as it tracks towards Florida, could be a test of the permanence of third-party capital in the global reinsurance sector, according to Standard & Poor’s (S&P).

Catastrophe risk modeling firm AIR Worldwide said that combined insurance losses for Hurricane Irma for the United States and some islands in the Caribbean will range from $20 billion to $65 Billion, with the U.S. likely to suffer up to $50 billion of the toll.

The market for live cat (live catastrophe) trading and protection buying saw a little activity yesterday, as hurricane Irma continued its approach towards Florida, with at least one trade completed with an industry loss trigger of $80 billion reported to Artemis this morning, and a few other deals getting done.

As major hurricane Irma continues to track west and the forecast path for the storm predicts the expected turn to the north towards Florida will be later, resulting in the landfall position shifting west, the potential impact to the ILS and catastrophe bond market lessens, according to Ben Brookes RMS Vice President of Capital Markets […]

International ratings agency, A.M. Best, has highlighted the increased use of retrocessional reinsurance protection amongst global reinsurers, including from the capital markets, which could limit some exposure to hurricane Irma as it maintains its track towards Florida, U.S.

Hurricane Irma’s threat to Florida saw the catastrophe bond market drop 16% yesterday, their biggest single days decline on record, as the ILS market and its investors recognised the severe threat the major hurricane poses to their investments.

Updated – 11:00 AM UTC on September 10th: Major Hurricane Irma continues on its path towards the state of Florida, slightly weakened after striking Cuba but still with winds sustained at 130 mph with higher gusts, and a chance of some further intensification before it strikes the Florida Keys in the coming hours.

According to a Bloomberg article one of the mutual ILS funds managed by New York based Stone Ridge Asset Management has fallen 8% on the approach of hurricane Irma, as the manager marked it down in expectation of losses.

Broker sources told Artemis that they are seeing increasing interest in so-called back-up reinsurance covers, or products that can provide added protection until the end of the year, all a reflection of the hurricane Irma threat following Harvey so closely, but still live cat trading activity remains light.

There are many catastrophe bonds that are potentially at risk from a major landfalling Hurricane Irma, with as much as $14 billion of the outstanding cat bond market holding some level of exposure to Florida or U.S. east coast named storms and hurricanes.