Hurricane losses and poor investment returns force up prices
Reinsurance prices will leap up at the 1 January renewal round as a result of the $25bn (£17bn) of hurricane losses, the FT reports.
In an analysis, the FT says reinsurance prices will rise because:
- losses from hurricanes Gustav and Ike
- the erosion of capital by weak stock and bond markets
- turbulent stock markets and constraints on borrowing making it difficult for reinsurers to replenish their balance sheets
- conditions hampering the start-up of new reinsurers.
The FT quotes Munich Re, Willis, Aon and Brit Insurance.
