Posted on 29 Dec 2009
Despite the unusually quiet hurricane season 2009, overall natural catastrophe losses have increased significantly over time and are expected to grow further, says reinsurer Swiss Re. The premium for its book of natural catastrophe covers reached USD 1.8 billion. Due to the lack of large catastrophe events in 2009 it contributes substantially to Swiss Re's overall profit.
“Europe has seen above average losses in 2009. The impact of climate change is likely to cause more frequent and more severe storms and floods around the globe in future“ says Executive Board Member and Head of Property & Specialty, Matt Weber.
Average insured natural catastrophe losses world-wide went from USD 5.1 bn per year in 1970-1989 to USD 27.1 bn per year in 1990-2009. As a result, according to Swiss Re, there is an increase in demand for natural catastrophe cover.
The reinsurer also says that intelligent cycle and sound risk management remain crucial to its business approach. This is true in the current environment but also when considering potential catastrophes.
Additionally, according to Swiss Re, strong public-private partnerships will be essential in tackling the marked increase in risk posed by natural catastrophes, especially in markets with outstanding hazards or developing insurance. Cases like the increasing storm surge risk in The Netherlands or Denmark become the challenges of the future.
Swiss Re continues to demonstrate its leadership in this area through innovative risk transfer solutions such as: tailor-made, complex solutions for industrial risks or emerging markets, including parametric covers; catastrophe bonds; and weather derivatives.