Guy Carpenter today released its annual Global Catastrophe Review, which reports that insured losses in 2014 were at the lowest level seen since 2009. According to the report, significant insured losses in 2014 totaled approximately USD33 billion, a dramatic drop when compared to the historic insured losses seen in 2011, which totaled approximately USD126 billion.
Posts Tagged ‘Property’
Eighty-nine percent of property and casualty (P&C) risk capital (based only on 144A cat bond transactions) had a bond tenor of either three or four years in 2014, a decrease from 93 percent in 2013. This was due to increased usage of risk periods longer than four years. This was largely influenced by Sanders Re 2014-1, a USD300 million five year transaction benefiting Allstate (Q2) and Kilimanjaro Re 2014-2, a USD500 million five year transaction benefiting Everest Re (Q4). Investors were receptive to longer-term transactions (a position we expect will continue into 2015) as both deals were oversubscribed. However, such deals closed either above or at the midpoint of initial price guidance, indicating that investors required additional compensation for risk periods longer than four years. Sponsors continued to express interest in bonds with risk periods beyond five years, which we expect will persist through 2015 and beyond.
Eighty-one percent of the property and casualty (P&C) risk capital (based only on 144A cat bond transactions) was structured with an indemnity trigger on either a per-occurrence, annual aggregate or multi-year aggregate basis. The use of indemnity triggers increased steadily from a low of 30 percent in 2011 to 55 percent in 2013.
After one of the slowest third quarters to date for 144A property and casualty (P&C) catastrophe bond issuance, the fourth quarter saw a flurry of activity that resulted in full year 144A P&C cat bond issuance exceeding USD8 billion - an industry record. Total risk capital outstanding as of December 31, 2014 equaled USD22.868 billion, the highest level of outstanding risk capital the market has ever supported.
The table lists the top ten catastrophe bond transactions that were completed in 2014.
2014 Catastrophe Bond Activity Ends on Record Note with More Innovative Bonds Expected in 2015, According to GC Securities* Report
The intense coastal storm is now clearing Atlantic Canada and steadily weakening. Blizzard and winter storm warnings have been discontinued, although winter weather advisories remain for select areas of New England. This storm lived up to expectations as an intense, impactful, and historic coastal storm, despite challenges on the forecast track and the especially sharp edge of the snow shield. Blizzard conditions with snowfall amounts of two to three feet affected a widespread area of New England and wind gusts exceeded hurricane force in some areas. The strong winds also produced a storm surge with greatest severity to coastal Massachusetts.
A deep coastal storm formed off the Outer Banks on January 26, 2015 and moved northward to impact many areas of the U.S. Northeast and Atlantic Canada. Blizzard warnings remain active from Rhode Island to Atlantic Canada, according to The National Weather Service (NWS) and Meteorological Service of Canada (MSC). Snowfall rates as high as two to three inches per hour, together with strong winds continue to restrict visibility and impose dangerous travel conditions. Conditions should improve for Boston this afternoon into the evening, and gradually clear from south to north over the next 24 hours or so.
Here is a look back at the 10 most popular CAT-i stories for 2014.
1. Severe Weather Outbreak in U.S.: April 26 to 30, 2014: A multi-day severe weather outbreak rendered severe impacts from April 26 to 30 affecting a large area of the United States. The outbreak occurred along a powerful spring frontal system that evolved from the Southern Rockies and pressed towards the Southern Great Lakes and affected the Atlantic Coast. According to the U.S. Storm Prediction Center (SPC), there were widespread reports of straight-line (nontornadic) wind and hail over the Southern States, Midwest and Lower Great Lakes. Tornado reports were widespread, with strong to violent tornadoes reported in states including Alabama, Arkansas, Kansas, Tennessee, Iowa and Mississippi. Severe flooding was also reported in Alabama and Florida.
2. Balkans Floods: Heavy rain caused widespread flooding across several countries in the Balkans region of Southeast Europe. Serbia, Bosnia and Herzegovina and Croatia were badly affected by the floods in May. According to Serbia’s Meteorological Institute, three months’ worth of rain fell in just three days in mid-May, resulting in the worst floods to hit the country since rainfall measurements began some 120 years ago. Bosnia also experienced its heaviest rainfall since records began in 1894, reports said.
3. 6.0Mw Earthquake - American Canyon, California: A 6.0-magnitude earthquake was reported by the U.S. Geological Survey (USGS) about 4 miles northwest of American Canyon, California and five miles north-northwest of Napa, California. The quake occurred at 3:20 a.m. local time (10:20 UTC) near the north shore of San Pablo Bay, with a magnitude of 6.0. The quake depth was 7.0 miles (11.3 km).
4. 8.2Mw Earthquake Near Chile Coast: An 8.2-magnitude earthquake was reported by the U.S. Geological Survey (USGS) about 40 miles off the northern coast of Chile on the evening of April 1. More than 60 aftershocks were reported following the initial event, one of which was measured of magnitude 6.2. Shaking was felt as far away as La Paz Bolivia, over 290 miles (470 km) away.
5. Severe Weather Outbreak In U.S.: June 3, 2014: A severe weather outbreak led to excessive wind gusts, significant hail, and a handful of tornadoes on June 3, according to reports. The area most severely affected covered the eastern two thirds of Nebraska together with portions of Iowa, Missouri, Kansas and Illinois.
6. Hurricane Gonzalo: Hurricane Gonzalo was forecast to make a direct hit or close approach to Bermuda sometime on Friday, October 17, most likely as a Category 3 hurricane on the Saffir-Simpson scale. Hurricane and tropical storm force winds extended outward up to 45 miles (75 kilometers) and 150 miles (240 kilometers) from the center of circulation, respectively.
7. Hurricane Arthur: Hurricane Arthur was the first hurricane to make U.S. landfall since 2012, and the earliest to make North Carolina landfall for any hurricane season since 1908. According to the National Hurricane Center (NHC), Arthur made landfall in North Carolina on July 3 at about 11:15 p.m. EDT (0315 UTC), with maximum sustained winds of 100 mph (161 km/hr).
8. Hurricane Odile: Hurricane Odile made a direct hit to the Southern end of the Baja Peninsula, Mexico, in mid-September, with impacts of great severity. Maximum sustained winds at landfall were 125 mph, a Category 3 hurricane on the Saffir-Simpson scale, according to the National Hurricane Center (NHC).
9. Hawaii Double Threat: Hurricanes Iselle and Julio: Hurricane Iselle was poised to become the first hurricane in 22 years to make a direct landfall in Hawaii. According to the Central Pacific Hurricane Center (CPHC), Iselle was located 305 miles east-southeast of Hilo, Hawaii and 510 miles east-southeast of Honolulu, Hawaii.
10. Severe Weather Outbreak in U.S.: June 16, 2014: An especially volatile environment produced a violent severe weather outbreak affecting areas of Nebraska, Iowa and Wisconsin. Severe to complete property damage was reported in Pilger, Nebraska and surrounding areas. Initial evidence indicated two tornadoes in close proximity near Pilger, with EF-2 to EF-3 intensities. Tornadoes were also reported in Southern Wisconsin where severe damage occurred. Hail and straight-line (nontornadic) wind reports also covered a very widespread area, with reports of hail exceeding two inches in diameter and wind gusts exceeding 74 mph.