According to the paper, commercial losses represent the biggest category, worth between $19.7 billion and $25.3 billion; personal lines represent $15.2 billion to $19.3 billion, and the remainder is made up of marine and energy losses ($4-6 billion), liability ($1-3 billion) and various others.
The total damage is greater than September 11, which cost around $35 billion, and 1992's Hurricane Andrew, the most financially damaging hurricane in recent history, which cost $20 billion.
Towers Perrin predicts the losses will discourage start-ups from entering the reinsurance business, and could also prompt rating agencies to take a closer look at catastrophe risk management plans and attempts to replenish capital after the hurricane. Reinsurers could benefit as insurance providers reassess their exposure to hurricanes specifically, and catastrophic risk in general.
The report added that, after forty years of relatively quiet hurricane seasons, the south-eastern US may be moving into a period of greater activity - and now there are far more people and property at risk. "Based on current exposures and climate conditions, we should expect a $20 billion hurricane loss roughly every 15 years," the study concluded.
The week on Risk.net, May 12-18, 2018Receive this by email