Property catastrophe reinsurance prices rose 9.5 percent globally for contracts renewed on Jan. 1 following “historic” natural disasters last year, the reinsurance broker owned by Marsh & McLennan Cos. said.
“There were wide-ranging rate movements at national, regional and even local levels depending on loss experience and exposure perceptions,” Guy Carpenter & Co. said in a report published on its website. “Rate movements for casualty lines continued to be subdued.” Most other lines saw increases and decreases in the “single digits,” the report said.
Last year was the priciest 12 months for natural disasters on record for reinsurers and the primary insurers whose risks they help bear, Munich Re (MUV2), the world’s biggest reinsurer, said on Jan. 4. Earthquakes in Japan and New Zealand and Australian and Thai floods cost the industry about $105 billion, surpassing the 2005 record of $101 billion, when reinsurers were forced to raise capital in the wake of Hurricane Katrina.
More than half of the insured losses recorded in 2011 will be paid by the reinsurance market, broker Willis Re said on Dec. 30. Property catastrophe rates rose for the first time following two years of declines, according to the Guy Carpenter World Property Catastrophe Rate on Line Index.
About two-thirds of the property and casualty reinsurance contracts of companies such as Munich Re, Swiss Re Ltd. (SREN) and Hannover Re (HNR1), the world’s fourth-biggest reinsurer, are typically up for renewal in January. The remainder is renewed in April and July.
To contact the reporter on this story: Oliver Suess in Munich at firstname.lastname@example.org