30 August 2017Insurance

Harvey unlikely to reverse declining cat pricing trends

Based on a company specific loss analysis, Hurricane Harvey is not “the catastrophe” the industry has been waiting for that could reverse pricing declines in the ultra-soft commercial property market, Credit Suisse analysts said in an Aug. 29 note.

Hurricane Harvey developed into a Category 4 and made landfall near Rockport, Texas on Friday, Aug. 25. In addition to direct losses, the storm is causing heavy rainfall and storm surge-related losses along coastal Texas.

Credit Suisse estimates insured losses in the range of $7.5 billion to $15 billion. If realistic, this projection is unlikely to cause a meaningful dent in industry excess capital and as a consequence reverse pricing declines in the property market, according to the analysts.

“We do not expect those taking losses to be rewarded with higher rates going forward,” the research note said.

Even with somewhat favourable catastrophes over the remainder of the year, the US P&C primary insurers appear likely to have an above average catastrophe year, which may have some impact on capital management programmes versus expectations, the analysts commented.

Already registered?

Login to your account

To request a FREE 2-week trial subscription, please signup.
NOTE - this can take up to 48hrs to be approved.

Two Weeks Free Trial

For multi-user price options, or to check if your company has an existing subscription that we can add you to for FREE, please email Elliot Field at efield@newtonmedia.co.uk or Adrian Tapping at atapping@newtonmedia.co.uk


More on this story

Insurance
30 August 2017   The Property Casualty Insurers Association of America has called on the US Congress to pass an extension of the National Flood Insurance Program (NFIP).
Insurance
29 August 2017   Loss estimates from Hurricane Harvey continue to vary widely as analysts and risk modelling agencies attempt to assess the impact from the storm and ongoing flooding in the state of Texas. Estimates range from $20 billion at the upper end to the low billions though these exclude flood losses.