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Europe’s Reinsurers Jump as Florida Avoids Worst From Irma
2017-09-11 08:12:51.966 GMT
By Ross Larsen and Oliver Suess
(Bloomberg) — Reinsurers tasked with covering major disasters jumped in European stock markets amid signs that payouts for damage caused by Hurricane Irma will be lower than expected.
Firms including Swiss Re, Munich Re and Hannover Re were among the biggest gainers on the Stoxx 600 Insurance Price Index on Monday, after the hurricane weakened and the most dire predictions proved wrong.
Hannover Re on Monday confirmed its full-year profit target and said damage from Irma will end a decline in catastrophe reinsurance rates. While it’s too early to estimate the costs to Hannover Re and the wider industry, the storm didn’t follow the path that would have created the greatest damage, Chief Executive Officer Ulrich Wallin said at a press conference in Monte Carlo.
Enki Research’s estimate for total damages caused by Irma dropped to $49 billion from $200 billion as the hurricane dwindled to a Category 2 before reaching the populous Tampa Bay area. Chuck Watson, an Enki disaster modeler in Georgia estimated insured losses at about $19 billion. Reinsurers cover other insurance companies in the event of major disaster losses.
“Modeling indicates that there is a 10 percent chance of insured wind losses from Irma exceeding $60 billion,”
catastrophe risk modeling firm RMS said on its website. “This threshold continues to decrease from previous guidance, reflecting the increasing probability of a predominantly offshore storm track.”
Beazley Plc topped the insurers index with a 6.6 percent gain of 8:43 a.m. in London. Swiss Re rose as much as 5 percent, the most since March 2014 and Hannover Re climbed the most since November.
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