Reinsurance News

Australia has been flooding again in the last week, as storms and torrential rain hit parts of the south east of the country and this episode has now been designated an insurance catastrophe, while rating agency S&P said so far the claims from it shouldn’t trouble reinsurance capital.

Globally, catastrophe losses that fall to the insurance and reinsurance industry are already near $100 billion, according to analysis from broker Aon, which estimates the total at $99 billion so far, including an amount for hurricane Ian.

Florida’s domestic property insurance carriers, as well as those coastal focused US catastrophe exposed property specialist carriers, are facing a far more challenging reinsurance renewal environment in 2023, Moody’s Investors Service has explained.

The world has a “vibrant wholesale risk market”, spanning insurance, reinsurance and insurance-linked securities (ILS), but it’s time to go back to basics, industry expert speakers explained at Convergence 2022 in Bermuda last week.

Even before hurricane Ian slammed into Florida, a cohort of reinsurance companies tracked by broker Aon were capital challenged this year, as financial market volatility and macroeconomics dented capital for the group.

K2 International, the London-based specialist MGA, is out raising capital for additional reinsurance and possibly US retrocession & ILW underwriting in 2023.

Global reinsurance company Swiss Re has announced its initial loss estimate after major hurricane Ian, pegging it at $1.3 billion, which is net of retrocessional recoveries and before tax.

If they aren’t properly compensated for taking catastrophe losses, investors in catastrophe bonds and other insurance-linked securities (ILS) are likely to look elsewhere for returns, Fitch Ratings has warned.

Reinsurance capacity for lower-layers of Florida focused towers is expected to become very limited in 2023, while renewal rates are likely to rise above expectations, according to Citizens Property Insurance Corporation CEO Barry Gilway.

Two of Australia’s largest insurers have both slashed their reserve provisions for business interruption claims from the COVID-19 pandemic after last week’s test case ruling.