Swiss Re Insurance-Linked Fund Management

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Verisk Catastrophe Index publishes insured loss estimates for Hurricane Irene


Risk information and analysis firm Verisk Analytics have announced some insured loss estimate figures resulting from hurricane Irene taken from a preliminary estimate of insured damages by county made using their Verisk Catastrophe Index product. They don’t disclose a total estimate for the event but do give some insight as to the state and county level figures resulting from their analysis.

The Verisk Catastrophe Index is a tool offered by Verisk which provides high-resolution insured property loss estimates, by county and line of business, after catastrophes providing values which could be used as trigger points for catastrophe bond and industry loss warranty transactions. It’s a relatively new product so the market will be looking at their estimates closely to assess whether they would want to utilise the index in any ILS/ILW transactions.

Their full estimate was prepared for the District of Columbia and the 13 states and 191 counties within them affected by hurricane Irene. At a state level, New York, New Jersey and North Carolina were the top three with insured property damage estimates of over $500m, Virginia and Maryland completed the top five impacted states. At county level Suffolk County, New York, followed by Dare County, North Carolina both have estimates of over $200m of insured property damage and were the top of the 191 counties affected by Irene. Nassau County, New York; Monmouth County, New Jersey; and Worcester County, Maryland all had over $150m of insured property damage and make up the top five impacted counties. In total eight counties received insured property damage estimates of over $100m.

This kind of granular level reporting certainly shows how this catastrophe index could be used to trigger a transaction and we expect to see this product used to help structure triggers for future hurricane cat bond and ILW issuances.

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