Posts Tagged ‘Catastrophe’
Here are recent CAT-i stories from the period July to mid-September of 2015.
Chile experienced an 8.3-magnitude earthquake on September 16, followed by dozens of aftershocks, including one at magnitude 7.0 and seven at magnitude 6.0 or above. According to the U.S. Geological Survey (USGS), the earthquake occurred near the coast of Coquimbo, about 46 kilometers (29 miles) west of Illapel at 19:54 local time. A tsunami warning was issued for the entire coast of Chile but has since been lifted. Initial media reports indicate at least 11 fatalities, although emergency crews are still accessing affected areas. The earthquake has forced more than one million people to evacuate from their homes and electrical power was cut off to 240,000 households. Heavy waves following the earthquake caused flooding in coastal towns although most buildings were reported to hold up well. The USGS pager service estimates most probable economic losses between USD 100 million and USD 1 billion. Our first thoughts and concerns are with those directly affected by this event.
In Central and Northern California, two wildfires have consumed over 133,000 acres and destroyed at least 750 homes and ten businesses in a matter of days. The fires have altogether displaced at least 23,000, according to media sources, and a state of emergency has been declared for affected areas by Governor Jerry Brown. Nearly 6,400 firefighters have been mobilized to combat the two fires, according to the National Interagency Fire Center (NIFC).
Fiscal constraints are increasing across many developed and emerging economies amid growing catastrophic loss potential brought on by the geopolitical climate, demographic trends and global climate change. As a result, heads of government, international trade organizations and private sector risk bearers are increasing their calls to reexamine the roles and responsibilities of society to better manage these complicated risks.
Challenging market conditions due to abundant capacity, the ongoing influx of new capital and limited loss experience, continue to put pressure on the reinsurance sector, while recent M&A activity is adding a new dynamic to the mix. This is according to the panel of speakers at the eighth annual press briefing held at the Reinsurance Rendez-Vous 2015 in Monte Carlo, by Guy Carpenter & Company, LLC, a leading global risk and reinsurance specialist and a wholly owned subsidiary of Marsh & McLennan Companies.
New capital inflows, excess capacity and few catastrophe losses have contributed to falling reinsurance prices and a challenging environment for specialty insurers and reinsurers. These factors have driven predictions of a forthcoming wave of market consolidation, which appeared to become a reality in late 2014 and 2015 when a series of rumors and announcements related to a number of large (re)insurers grabbed headlines.
Port of Tianjin Explosions Set to Become One of Asia’s Largest Insured Man-Made Loss Events: Potential Losses Between USD 1.6 Billion to USD 3.3 Billion
Guy Carpenter today released a report on the Port of Tianjin Explosions. The report provides initial loss estimates and outlines the many variables involved in assessing the losses emanating from the two massive initial explosions that occurred at Tianjin Port on August 12 of this year.
Consistent with Guy Carpenter’s post-January 1, 2015 renewal report, the U.S. casualty reinsurance market continued to soften on both quota share and excess of loss reinsurance programs. This trend continues to be driven by the reduction in property catastrophe premiums, causing reinsurers to further diversify their overall premium writings into casualty lines and by the improved loss ratios among these underlying lines of business. As a result, reinsurance pricing continued to soften via ceding commissions increases on quota share placements (albeit at a slower pace than in 2014 and earlier in 2015) and rate decreases on excess of loss placements (subject to stable loss experience).