Loss will affect local cat rates but will not turn market
(Re)insurance losses from today's magnitude 8.9 earthquake and tsunami in Japan could be limited to $10bn, according to James Shuck, insurance analyst at stockbroking firm Jefferies.
Shuck said in a research note that the event, which hit this morning, could redult in a 5% mpact on (re)insurers' and Lloyd's firms' balance sheets.
"We expect some rate momentum in the upcoming Japanese/catastrophe renewals, but not enough for the total industry cycle to turn," Shuck wrote. "Tsunami and aftershocks remain real risks, and this will drag on sector performance."
The Japanese renewals take place on 1 April and international catastrophe renewals on 1 June and 1 July.
The $10bn loss estimate compares with a one-in-250 year event estimate of $50bn for a Japanese earthquake.