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Member, Beacon International Group, Ltd.
The large number of natural catastrophes so far this year are likely to increase insurance prices for July 1 renewals in the affected areas and business lines, Munich Reinsurance Co. said Tuesday.
The Munich-based reinsurer said it believes there is a “long-term trend towards ever-higher natural catastrophe costs.”
“The number and intensity of weather-related catastrophes is expected to increase in the coming decades largely on account of climate change,” the reinsurer said in a statement. “Munich Re therefore anticipates price increases in the loss-affected regions and business segments.”
Total insured losses caused by the February earthquake in Chile are likely to reach $8 billion, said Munich Re, which increased its estimated losses from the quake to $1 billion from its previous estimate of $700 million.
It said losses from the earthquake, which also triggered a tsunami, had been difficult to reliably assess before now because of low primary insurer retentions, a high proportion of facultatively reinsured buildings and ongoing business interruption losses.
Munich Re said it expected reinsurance losses of about €70 million ($83.8 million) from Windstorm Xynthia in February. It also said it had established claims provisions for about €160 million ($191.5 million) in losses as result of March hailstorms in Australia.
In addition, Munich Re said it expects losses from May flooding of the rivers Oder and Vistula in Poland and Germany, but said figures were not yet available.