As Hurricane Irene makes its way towards the East Coast, insurance and reinsurance companies are...


As Hurricane Irene makes its way towards the East Coast, insurance and reinsurance companies are on edge. Macquarie's Amit Kumar thinks any losses north of $20B would "mark the tipping point" for the property catastrophe reinsurance market, producing a major overhaul of how the industry operates.

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Comments (3)
  • Bozerdog
    , contributor
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    Aren't insurance companies supposed to be ready for catastrophes?
    23 Aug 2011, 04:46 PM Reply Like
  • bonehead69
    , contributor
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    According to Joe Bastardi, probably the best meteorologist alive, this hurricane is substantial and will most likely have billions of dollars of impact. I wonder what they mean by "a major overhaul of how the industry operates". Joe is at weatherbell.com.
    23 Aug 2011, 05:42 PM Reply Like
  • usandy
    , contributor
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    Insurance companies have actuaries that evaluate all sorts of risk and loss experience. In life insurance, they use mortality tables. In property insurance, they use occurrences of '100 year' weather patterns, existence of up to date building and fire codes, and reinsurance rates to calculate their potential for loss.
    The major overhaul probably refers to the fact that they will have to raise rates and cancel policies if they get beat up too bad by Irene.
    26 Aug 2011, 12:39 PM Reply Like
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