Hurricane Ian 2022

Based on third-quarter data provided by syndicates operating there, Lloyd’s has estimated that hurricane Ian losses to the market will total between $2.3 billion and $3 billion, on a net basis.

Florida’s property insurer of last resort Citizens Property Insurance Corporation has significantly increased its loss estimate for hurricane Ian, raising it to $3.8 billion, a level at which some private market reinsurance capacity will likely come into play, but leading it to believe its catastrophe bonds won’t be triggered.

The secondary market for catastrophe bonds has again demonstrated that timing can be everything when it comes to trading in liquid markets, or conversely that some investors may get proven to have been prescient with their trade selections, when it comes to catastrophe bond market losses from hurricane Ian.

Catastrophe bond funds, as measured by the Plenum CAT Bond UCITS Fund Indices, have gained further ground in the last week of reported data, jumping more than one percent on average at the last available calculation point of November 4th.

Plenum Investments has slashed hurricane Ian loss expectations for its catastrophe bond investment funds, saying that initial estimates from sponsors are coming in “significantly lower than our original expectations”, leading it to believe the draw-down could be less than half the initial estimates.

The U.S. Federal Emergency Management Agency (FEMA) has issued an estimate of flood insurance claims for the National Flood Insurance Program (NFIP) from hurricane Ian, giving a range of $3.5 billion to $5.3 billion, at which level the catastrophe bonds wouldn’t face losses.

United Insurance Holdings Corp. (UPC Insurance) has revealed that it expects to cede roughly $501 million of its hurricane Ian losses to open reinsurance market partners and for the event only has around $9.3 million of limit left in its main tower.

Global reinsurance company SCOR has reported a net loss for the first nine months of 2022 across its business of EUR -509 million, with its P&C business particularly affected by natural catastrophe losses, hurricane Ian and reserve strengthening in the third-quarter.

During the third-quarter of the year, Universal Insurance Holdings, the Florida headquartered primary insurance carrier, continued to experience loss creep from 2017’s hurricane Irma, ceding additional losses through to reinsurance sources.

Bermuda-based insurance and reinsurance company, Everest Re, continues to benefit from a robust pipeline of insurance-linked securities (ILS) investment opportunities and is seeing a “high degree of interest” in its collateralized reinsurance sidecar-like vehicle, Mt. Logan Re Ltd., according to Chief Financial Officer (CFO), Mark Kociancic.