We are now on the cusp of hurricane season. Storm predictions have called for “above average” activity this year; just as we roll out of record setting tornado activity over the last two months. The cushion of excess capacity is gone or nearly gone for most insurers and reinsurers. One more natural disaster could be the tipping point that leads to the turn in the (insurance) pricing cycle. We know capacity is just a part of the many aspects to take into account when evaluating the reinsurance sector. However, the…
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Experts claim catastrophe risk modeling needs to change
The property and casualty insurance business isn’t what it used to be. Traditional methods of deciding risk management worked well in its time. According to the managing director of the Wharton Risk Management and Decision Process Center (WRMDPC) in Pennsylvania, the time has come where changing the way the industry calculates risk is essential to its survival. In the property and casualty sector, the traditional notion was that catastrophic events only occurred about every 25 years or so. It also counted on the fact that the risks were, for the…
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