Archive for August, 2011



August 31st, 2011

Typhoon Nanmadol

Posted at 12:12 PM ET

nanmadol-smallTyphoon Nanmadol developed on August 22 to the east of the Philippines and rapidly intensified to become the fourth typhoon of the West Pacific typhoon season. The storm went on to make landfall in the Philippines, Taiwan and China, causing widespread damage and disruption in each country. At least 26 people were killed in the Philippines and Taiwan and early estimates suggest insured losses from the event could be in the hundreds of millions of dollars.

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August 31st, 2011

Tropical Storm Katia

Posted at 9:08 AM ET

katia-smallKatia became the eleventh named storm of the 2011 Atlantic hurricane season after it developed on August 30 to the south of the Cape Verde Islands. The storm is currently located approximately 985 miles (1,585 kilometers) west of the Cape Verde Island and packs sustained winds of around 65 mph (100 kmph), equivalent to a strong tropical storm, according to the National Hurricane Center (NHC). Katia is traveling in a west-northwest direction and is expected to maintain this general motion for the next couple of days. The NHC said tropical storm force winds extend 85 miles (140 kilometers) from the center of the storm.

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August 31st, 2011

New Oliver Wyman/Institute of International Finance Report: The Implications of Financial Regulatory Reform for the Insurance Industry

Posted at 1:00 AM ET

International policy makers are developing new regulatory regimes aimed at ensuring enhanced financial stability in the post-financial crisis world. While the objectives of each of these regulatory initiatives may be clear, their interdependencies are not. Intricacies of new regulations or inconsistencies between regimes could adversely impact risk management practices at both insurers and banks and cause distortions in the market. Oliver Wyman’s new paper, The Implications of Financial Regulatory Reform for the Insurance Industry - produced by collaboration between Oliver Wyman and the Institute of International Finance with a working group of global insurance executives - explores these issues and highlights incentives that these differences appear to provide.

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August 30th, 2011

Update: Hurricane Irene

Posted at 10:32 AM ET

irene-9-smallHurricane Irene made three landfalls in the United States over the weekend, becoming the first hurricane to come ashore in the U.S. mainland since Ike in 2008. Irene made its initial landfall near Cape Lookout on the Outer Banks of North Carolina at around 12:00 UTC on August 27 with sustained winds of around 85 mph (140 kmph), equivalent to a category 1 hurricane, according to the National Hurricane Center (NHC). The storm then made its second landfall as a slightly weakened category 1 hurricane (with sustained winds of 75 mph) near Little Egg Inlet in New Jersey at 09:30 UTC on August 28. By 13:00 UTC on the same day, Irene made its third landfall as a tropical storm in New York City, where maximum sustained winds were estimated at 65 mph (110 kmph). Irene’s center then moved inland through the New England area before becoming a post-tropical storm near the United States/Canadian border.

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August 30th, 2011

Terrorism Risk: How Guy Carpenter Can Help

Posted at 1:00 AM ET

David Flandro, Global Head of Business Intelligence, Paul Knutson, Managing Director, Emil Metropoulos, Senior Vice Present, Julian Alovisi, Assistant Vice President
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Guy Carpenter is uniquely positioned to help clients manage their terrorism risks around the world. Our GC Analytics®  team offers services and solutions that include industry-leading proprietary catastrophe models, actuarial services and capital models. We encourage you to contact your Guy Carpenter representative to review and discuss your modeling and capital needs in more detail.

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August 29th, 2011

Terrorism: Guy Carpenter Solutions

Posted at 1:00 AM ET

Guy Carpenter offers a comprehensive suite of tools to help clients manage their terrorism risks. i-aXs®, our web-based data management platform, allows insurers to quantify their exposure to a potential terrorist attack and highlight concentrated areas in their portfolio. Managing exposure to terrorism loss is an integral function within i-aXs, with several different tools available to help insurers assess their largest levels of accumulation.

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August 26th, 2011

Update: Hurricane Irene

Posted at 3:40 PM ET

irene-8-smallHurricane Irene is currently located approximately 300 miles (480 kilometers) south-southwest of Cape Hatteras in North Carolina, according to the National Hurricane Center (NHC). The storm has weakened slightly over the last 12 hours and now has sustained winds of around 100 mph (155 kmph), equivalent to a category 2 hurricane. Little change in strength is forecast and the NHC expects Irene will approach the North Carolina coast as a category 2 hurricane. Irene is currently traveling in a northerly direction and a gradual turn to the north-northeast is expected tomorrow. On this forecast track, Irene will pass well offshore of Florida’s east coast today. The storm is then expected to approach North Carolina tonight and pass near or over the state’s coast tomorrow before heading towards northeastern regions of the United States. The NHC said Irene is now a very large hurricane, with hurricane force winds extending 90 miles (150 kilometers) from the center of the storm and tropical storm force winds extending 290 miles (465 kilometers).

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August 26th, 2011

Week’s Top Stories: August 20 - 26, 2011

Posted at 11:00 AM ET

Update: Hurricane Irene: Hurricane Irene is currently located approximately 105 miles (170 kilometers) north of Nassau in the Bahamas and 610 miles (980 kilometers) south of Cape Hatteras in North Carolina, according to the National Hurricane Center (NHC). The storm packs sustained winds of around 115 mph (185 kmph), equivalent to a category 3 hurricane. Irene is expected to strengthen over the next 24 hours, potentially reaching category 4 status as it approaches the southeastern coast of the United States.

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Terror Attacks at Historically High Levels, Still Pose Threat to (Re)Insurance Industry, According to Guy Carpenter Report: A new report on global terrorism and the terror reinsurance market, released by Guy Carpenter, finds that while recorded incidents of terror around the world remain at historically high levels and terrorism remains a serious risk to the (re)insurance industry, the industry continues to meet the current demands for terrorism risk transfer.

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Guy Carpenter Publishes First Industry Risk Benchmarks Report: Guy Carpenter & Company announced publication of its first Industry Risk Benchmarks report, which provides risk benchmarks for loss ratios and reserves, by line of business, for coefficient of variation (standard deviation/mean), correlation and cycles.

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Risk Profile, Appetite, and Tolerance: Fundamental Concepts in Risk Management and Reinsurance Effectiveness: Prior to the recent turbulence in the financial markets, insurers and reinsurers were increasing their use of enterprise risk management to make risk and capital management decisions. While this was driven in part by rating agencies and regulators, many carriers began to recognize the value of metric-based frameworks and capital models in evaluating their portfolios.

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First Six Months 2011: Subdued Merger and Acquisition Activity: The recent volatility in the financial markets and the difficult operating environment in general continue to stifle merger and acquisition (M&A) activity. Property/casualty (P&C) M&A activity for risk-bearing entities in the first half of 2011 was at a similar level to that seen in the past two years. There were 22 announced and closed transactions with an aggregate deal value of almost USD3.4 billion during the first half of 2011. In terms of transaction value, this pace is on track to match the level seen during 2009 and 2010.

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Reinsurance Brokers: Orderly Markets and Optimized Results, Executing the Transaction: The primary role of the reinsurance broker is to help insurers move risk out of their portfolios, most often - unsurprisingly - via the purchase of reinsurance. Cedents have three basic objectives for the use of reinsurance: reduce risk held, optimize the productivity of capital and manage earnings. The first is clear - reinsurance entails the act of transferring risk to another party. In doing this, the cedent gains flexibility in deploying the capital it has on hand, which produces revenue, market share and market capitalization growth opportunities. Insurers also use reinsurance to remove some volatility from their earnings. Consequently, reinsurance is much more than a tactical risk management tool; rather, it is of strategic value to every cedent in the marketplace.

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August 26th, 2011

Update: Hurricane Irene

Posted at 8:25 AM ET

irene7-smallHurricane Irene is currently located approximately 420 miles (675 kilometers) south-southwest of Cape Hatteras in North Carolina, according to the National Hurricane Center (NHC). The storm has weakened slightly over the last 12 hours and now has sustained winds of around 110 mph (175 kmph), equivalent to a category 2 hurricane. The NHC said Irene could strengthen today and the storm is expected to be near the threshold of category 2 and category 3 status as it reaches the North Carolina coast. Irene is currently traveling in a northerly direction and a gradual turn to the north-northeast is expected tomorrow. On this forecast track, Irene will pass well offshore of Florida’s east coast today. The storm is then expected to approach North Carolina tonight and pass near or over the state’s coast tomorrow before heading towards northeastern regions of the United States. The NHC said Irene is now a very large hurricane, with hurricane force winds extending 90 miles (150 kilometers) from the center of the storm and tropical storm force winds extending 290 miles (645 kilometers).

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August 25th, 2011

Update: Hurricane Irene

Posted at 4:42 PM ET

irene-6-smallHurricane Irene is currently located approximately 105 miles (170 kilometers) north of Nassau in the Bahamas and 610 miles (980 kilometers) south of Cape Hatteras in North Carolina, according to the National Hurricane Center (NHC). The storm packs sustained winds of around 115 mph (185 kmph), equivalent to a category 3 hurricane. Irene is expected to strengthen over the next 24 hours, potentially reaching category 4 status as it approaches the southeastern coast of the United States. Irene is currently traveling in a north-northwest direction, and will continue this movement through tonight before taking a turn towards the north by early Friday. On this forecast track, Irene is expected to move over the northwestern Bahamas today and pass well offshore of Florida’s east coast tomorrow. The storm is expected to brush the North Carolina coast on Saturday before heading towards northeastern regions of the United States. The NHC said Irene is now a dangerous storm, with hurricane force winds extending 70 miles (110 kilometers) from the center of the storm and tropical storm force winds extending 290 miles (465 kilometers).

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