Why 2020 Has Made the Ever-Evolving Cyber Landscape Even More Dynamic: The insurability of systemic cyber risk will be one of the defining issues of the next decade for the (re)insurance sector. Rapid technological changes and digitalization in particular have already transformed the characteristics of risks assumed by the (re)insurance market. As companies depend more on technology to conduct business, they are also increasingly subject to technology’s unique vulnerabilities. These are wide-ranging and can include system or supply chain disruption or failures, distributed denial of service, hacking and ransomware attacks that may result in increased costs and lost revenue.
Clarity Over Coverage is Critical as COVID-19 Casts a Shadow over January Renewals: Reinsurance renewal negotiations are delicately poised, with increasing pressure on rates, economic uncertainty and disputes over COVID-19 wordings putting long-standing relationships to the test.
Category 5 Hurricane Iota to Render Catastrophic Winds, Storm Surge & Rainfall to Central America: Exceeding even the most aggressive forecasts from Friday, Iota became the strongest and most rapidly intensifying hurricane of the 2020 Atlantic hurricane season. Deepening an incredible 61 mb in 24 hours, Iota was declared a category-5 hurricane with maximum sustained winds of 160 mph as of 10AM EST, Monday November 16.
Leading Up to January 2021 Reinsurance Renewals: Guy Carpenter’s new briefing, Leading Up to January 2021 Reinsurance Renewals, highlights the myriad market developments providing the backdrop to January 1, 2021 renewals. The topics range from COVID-19-related losses and rate movements at the mid-year renewals, through tightening capacity across certain insurance classes and loss developments on long-tail lines of business.
Guy Carpenter U.S. Property Catastrophe Rate-On-Line (ROL) Index: The U.S. property catastrophe Rate on Line (ROL) index for January through July renewals was up 12 percent year-on-year. Pricing pressures have built through the course of the year: The mid-year data point represents a larger increase than what was recorded at January 1. Wind and wildfire-exposed programs once again played a prominent role in driving the index higher, with COVID-19 acting as an accelerating force.
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The Changing Nature of Risk: There is an old adage that “adversity builds character.” However, before adversity builds character, it reveals character, and the numerous catastrophes that have occurred over the last several years combined with the ongoing pandemic have clearly revealed the character of the insurance industry.