Insurance Actuaries Prepared for Even More Damaging Hurricanes

December 19, 2005

  • December 19, 2005 at 2:42 am
    Peter Polstein says:
    Like or Dislike:
    Thumb up 0
    Thumb down 0

    Folks, there hasn\’t been a cat model yet that has been close to predicting loss expectancy, or net loss cost rating. There has not been, nor will there ever be, any actuarial basis by which you can judge adequate rating for these cat exposures. This problem, is not the job of the Federal Government to bail out what has been less than realistic underwriting. Yet, isn\’t it strange that a significant amount of new capital coming into the marketplace, especially on Bermuda appears to be prepared to underwrite cat cover. Has this industry gotten to the point, that it has become so avarice, with little regard for legitimate underwriting that no one cares? There were those who believed that the marketplace, especially on property would turn hard, no sign. What has showed up, are underwriters who continue their roll as so called \”market share\” participants, with little regard for what will continue to be potentially critical losses within the industry.

    Some of you are aware, that I am a contract writer for IRMI. I\’m not attempting to foist anything on the readers of this site, or in fact IRMI, but they already have a lengthy article which will be published shortly, outlining a potentially interesting alternative to physically insuring catastrophy losses in the traditional manner.

    Insurance, is this the only way to solve the problem? I\’m not suggesting that what I write is the end all, be all alternative, but it does place this subject outside of the box. There are others I\’m confident who think outside the box, they need to be heard.

    I\’ll undoubtedly catch a ration of you know what from this, but good grief, let\’s think of sensible methodology.

    Be well all, happy holidays ( the politically correct verbiage) and a healthy, safe New Year.

Add a Comment

Your email address will not be published. Required fields are marked *