Significant catastrophic events in the first half of 2010


Guy Carpenter have published the first part of their report looking at the World Catastrophe Reinsurance Market. In it they look at the major loss events of the first half of 2010 and comment on how the market is fairing.

A major topic in the report is pricing. Guy Carpenter say that despite the $23b of insured losses from the first six months of the year reinsurance pricing is still on a downward trend. Global catastrophe reinsurance rates fell on average 6% during 2010 renewals according to the Guy Carpenter World Rate on Line (ROL) Index. They say a loss of $20b to $30b is needed to stabilise the market while a loss of $50b could correct pricing.

On catastrophe bonds, they say issuance will be influenced by how many catastrophes there are during the second half of the year, in particular the Atlantic hurricane season has the ability to change the market dynamic depending on severity of storms.

Here’s some data from the report on the main catastrophe events from the first half of the year.

DateEventRegion / CountryInsured loss
(USD million)
January 12EarthquakeHaiti150
February 26-28Windstorm XynthiaEurope3,400
February 27EarthquakeChile8,000
March 1-3HailstormsMelbourne, Australia755
March 13-15Severe weatherUnited States1,045
March 22HailstormsPerth, Australia760
April 20Oil rig explosionGulf of MexicoUp to 3,500
May 12-16Severe weatherUnited States1,065
May/JuneFloodsCentral & Eastern Europe280
June 15-16FloodsFrance865

We’ll have to wait a while until we know whether Hurricane Igor has made significant losses on Bermuda, although we hear it is expected to be in the hundreds of million dollars.

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