
1. COVID-19 Losses and Business Interruption – Leading Up to January 2021 Reinsurance Renewals: With regard to direct COVID-19 losses, many market commentators are revising their initial loss estimates downward, particularly in the domain of property business interruption (BI). Based on third-quarter earnings announcements to date, reported losses for COVID-19 reached just over USD 25 billion, much of which is incurred but not reported. At this time, there are many steps still to complete before ultimate outcomes are better understood.
2. The Changing Nature of Risk – Casualty Dynamics: History shows that the insurance market is cyclical, and this is especially true for casualty lines of business. As long-tail lines, the ultimate profitability of a year is not known for many years as changing loss trends and causes may not be recognized until it is too late to protect against adverse development. The casualty marketplace now finds itself in such a position, according to Christopher Ross, Managing Director, Guy Carpenter.
3. How (Re)insurance Fits into the COVID-19 Landscape – Leading Up to January 2021 Reinsurance Renewals: Prior to COVID-19, the (re)insurance industry was already facing a range of challenges. The widespread impact of a global lockdown added to this challenging market and created the potential for even greater volatility. For an industry founded on the principles of diversification, we are now grappling with the implication of the first globally systemic insurance loss.
4. Catastrophe Bond Activity – Looking Towards 2021: Catastrophe bonds are set to buck the trend elsewhere in the insurance-linked securities (ILS) market, with a strong issuance pipeline for the fourth quarter of 2020 and first quarter of 2021, according to Des Potter, Managing Director, ILS origination and structuring at GC Securities.*
5. Chart: Top 10 Largest Insured Losses vs Projections for COVID-19: The chart in the link below shows how industry loss estimates for COVID-19 put forward by a number of entities compare to other major insured events, in inflation-adjusted terms.
6. Health Insurers and COVID-19 – Background and Timeline: As COVID-19 spreads throughout the United States and the resulting economic disruption continues, medical insurance carriers are responding to the needs of their customers in a rapidly changing market landscape shaped by legislative and competitive conditions. In this article, we provide an overview of how large medical insurance carriers are adapting to the needs of their insureds and employees.
7. Wildfire – Understanding and Modeling the Risk: The ability to understand the underlying risk and to model potential exposures will be key to risk management and underwriting decisions moving forward.
8. Health Insurers and COVID-19: Future Impacts: Guy Carpenter has identified certain factors that may impact how large medical insurance carriers adapt to the needs of their insureds and employees in the United States amid COVID-19.
9. Video – Cyber Underwriters Avoid COVID-19 Exclusions Even as Ransomware Concerns Soar: COVID-19 has presented an opportunity for rogue actors to attack vulnerable companies and indeed individuals. In the following video with The Insurer, Siobhan O’Brien discusses how cyber underwriters are avoiding COVID-19 exclusions despite increasing ransomware concerns.
10. The Great Coronavirus Restructuring: The (re)insurance sector is well-versed at navigating market-changing events, and while the impact of previous shock events such as Hurricane Andrew, the terrorist attacks of September 11, 2001, and Hurricane Katrina may have resulted in a loss of capital and reduced capacity in the short-term, the market responded to each occasion by innovating, working with governments and attracting more capital in the longer term. Liquidity and access to capital are crucial to ensuring risk carriers can continue to provide cover following market-changing events.
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*Securities or investments, as applicable, are offered in the United States through GC Securities, a division of MMC Securities LLC, a US registered broker-dealer and member FINRA/NFA/SIPC. Main Office: 1166 Avenue of the Americas, New York, NY 10036. Phone: (212) 345-5000. Securities or investments, as applicable, are offered in the European Union by GC Securities, a division of MMC Securities (Europe) Ltd. (MMCSEL), which is authorized and regulated by the Financial Conduct Authority, 12 Endeavour Square, London, E20 1JN. Reinsurance products are placed through qualified affiliates of Guy Carpenter & Company, LLC. MMC Securities LLC, MMC Securities (Europe) Ltd. and Guy Carpenter & Company, LLC are affiliates owned by Marsh & McLennan Companies. This communication is not intended as an offer to sell or a solicitation of any offer to buy any security, financial instrument, reinsurance or insurance product.