An estimate of insurance and reinsurance industry losses from the severe bushfires in Australia over the last season has been raised by 19%, with the hours clause appropriate seven consecutive day period loss now seen as A$1.86 billion (almost US $1.3bn) by PERILS AG.
Zurich based industry backed catastrophe loss data aggregator PERILS AG opted to focus its bushfire estimates on a peak seven day period that fits better with the 168 hours clause that many Australian insurers use.
Now, the company has raised the estimate by around 19%, saying that the insurance market toll, a relatively significant amount of which has been paid by reinsurance capital we understand, is estimated to be just over A$1.86 billion (almost US $1.3bn).
PERILS has also released an industry loss footprint for the Australian bushfires of 2019/2020, the first source of postcode level data for the fires.
While PERILS continues to focus on the seven day period, to match the loss estimate more closely with the commonly used hours clause in Australia, it notes that the peak seven-day loss period differs among insurers.
Generally the peak lies between 20 December 2019 and 6 January 2020, but for the majority of insurers, it is between 30 December 2019 and 5 January 2020, PERILS said.
The estimate compares to the Insurance Council of Australia’s A$2.34 billion estimate of insurance and reinsurance market losses from the bushfires over that entire period.
The fact the seven day peak is so high reflects the significant impacts felt across affected regions during a narrow period of the bushfire season.
PERILS loss report breaks down property and motor insured losses by postcode, with the data further divided by residential and commercial lines.
The report includes losses from buildings, contents and business interruption.
Darryl Pidcock, Head of PERILS Asia-Pacific, said, “This industry loss footprint is the first time PERILS has reported a bushfire event in Australia at such a detailed resolution. By providing the bushfire loss data and intensity information on a postcode and LOB level, we believe this can help the insurance industry better understand the impact of future bushfire events. The affected communities have been significantly impacted by these losses and are now facing additional pressures from the coronavirus pandemic. Our thoughts go out to those affected and we hope that they can rebuild their lives as soon as possible.”