Since the natural catastrophe becomes more often and destructive, it is difficult to access a key back stop to help to help to meet the losses.
According to the S&P World Ranking, the insurance industry, which is there to help cope with the damage to the basic insurance after the collision, has taken significant steps to protect itself against the financial loss of storms, floods and other severe weather.
Over the past half decade, the top 19 global insurance has not exhibited their exhibition due to the loss of insured, and possibly, according to Simon Ashworth, chief analysts at S&P, will historically beg for a little burden.
“I do not expect the pendant to return at any time soon,” he said in an interview.
The industry has made considerable buffers after several years of increasing losses and investment in investment. According to S&P, major insurance companies now have enough investment to handle the damage equal to three hurricanes Katrinas in the same year, while S&P, while maintaining their current credit rating, in the same year, or about $ 300 billion.
Ashworth said, “This is noteworthy.”
This year, natural catastrophe has faced that they are taking insurance losses in the past for $ 150 billion, which is beyond an average of 10 years, according to Risk Modeler Verksk. Basic insurances are struggling at the weight of the costs they now face, insurance companies face growing pressure to reduce their prices and increase their coverage.
S&P has seen “moderate decreases in rates” by insurance companies, which Ashworth says “will help relieve some pressure on basic insurance companies.” But overall, the industry is ready to “stick to the terms and conditions”.
According to S&P, the insurance industry covered only more than 10 % of the disastrous losses last year, compared to about 25 % in 2019 and less than 20 % of the historical average.
“Many insurance cars are rapidly selected, emphasizing profits on development, and denying businesses that do not meet the harsh threshold limit,” said Fich Ratings in a recent report. “Especially in US property and accidental lines.”
This week, insurancers are meeting together with the annual gates in Monte Carlo, during which executives discuss how to approach evolution trends. According to Moody’s rating, they include expectations in the basic insurance companies that make up their client’s foundation that will reduce the prices of insurance companies.
A survey conducted by Moody of Insurance buyers shows that three -quarters are expected to decline in property insurance prices, some are looking for deductions up to 7.5 % next year.
Moody also has notes that in the long run, severe weather will create a “key challenge for the insurance sector” as the natural catastrophe increases more often. In the 1970s, there were about 50 most extreme weather events annually. Moody says that in the last decade, there were close to 200.
Moody said insurance companies also suffer major losses in the form of so -called secondary risks, such as severe stimulation storms and forest fires. And detecting how such an event is to model is proving to be a challenge for buyers and sellers such as destructive bonds such as insurance securities.
In the insurance assets, Dutch Pension Investors, who monitored $ 7.5 billion ($ 8.8 billion) in insurance assets, said that the insurance-related investment head, Evelyn, said, “There are difficulties for the model with a challenging model.” “It is important that the model has been updated.”
For now, insurance companies have reduced their exposure to secondary risks to the level of losses, which the policies pay, as the attached points.
The industry made a total budget of $ 21 billion in 2025 to deal with the devastating losses, of which insurance companies have only used only half. In comparison, the major US primary insurance companies have already used 80 % of their budget, which is why they are in large section due to a forest fire in California.
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