Hannover Re said it expects a net loss of €120 to €180 million ($155 to $233 million) before tax as a result of windstorm Kyrill. The bulk of the expenditure is attributable to claims in Germany.
Hannover Re said the storm, which swept across Northern Europe between Jan. 17 to 19, “caused insured losses in the order of €4 to €7 billion [$5.18 to $9.07 billion]. The exact scale of insured damage cannot yet be reliably assessed in view of the multitude of small- and medium-size losses and the large number of countries affected.”
The German reinsurer indicated that “the total loss amount was alleviated by the ‘K5’ risk securitization which had been expanded to $520 million as at January 1, 2007 (see NewsLetter published on January 16, 2007).”
“Even after ‘Kyrill’ we are within the bounds of our loss expectations”, explained CEO Wilhelm Zeller. Hannover Re said its “budget for major claims assumes a loss experience within the multi-year average for the full year; it corresponds to around eight percent of net premium expected in property and casualty reinsurance.”
“This severe storm will have a favorable effect on rate movements in European catastrophe reinsurance in the coming year. ‘Kyrill’ brought home to European insurers that wind is just as much a force to be reckoned with in Europe as it is in the United States,” Zeller added.
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