Cat Hit Makes 2018 a Crucial Year for Lloyd's

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Cat Hit Makes 2018 a Crucial Year for Lloyd's MARKET NEWS, DATA AND INSIGHT ALL DAY, EVERY DAY TUESDAY 12 DECEMBER 2017 ISSUE 4,997 In depth: Cat hit makes 2018 a crucial year for Lloyd’s p4-7 Raging Thomas fire threatens to IAG deal add to $10bn California wildfire bill lays ground for ‘10% premium boost’ for top three reinsurers p2 p3 Get the complete picture Award-winning scoops, trusted analysis and insight for the specialty and reinsurance sectors ID-Complete Picture-260x70.indd 1 08/09/2017 14:23 2 www.insuranceday.com | Tuesday 12 December 2017 NEWS Raging Thomas fire Market news, data and insight all day, every day Insurance Day is the world’s only daily newspaper for the international insurance and reinsurance and risk industries. Its primary focus is on the London market and what affects it, threatens to add to $10bn concentrating on the key areas of catastrophe, property and marine, aviation and transportation. It is available in print, PDF, mobile and online versions and is read by more than 10,000 people in more than 70 countries worldwide. California wildfire bill First published in 1995, Insurance Day has become the favourite publication for the London market, which relies on its mix of news, analysis and data to keep in touch with this fast-moving and vitally important sector. Its experienced and highly skilled insurance writers are well known and respected in the market Fire in southern California is among state’s 10 most destructive and their insight is both compelling and valuable. Insurance Day also produces a number of must-attend annual Scott Vincent Firefighters events to complement its daily output, including the Insurance Editor, news services monitor the Day London Market Awards, which recognise and celebrate the Thomas fire as very best in the industry. it burns through Los Padres For more detail on Insurance Day and how to subscribe or National Forest: attend its events, go to subscribe.insuranceday.com the blaze is now alifornia’s Thomas fire has be- the fifth-largest Insurance Day, Christchurch Court, 10-15 Newgate Street, come the fifth most expansive in state history London EC1A 7HD in state history with more than © 2017 Noah 230,000 acres burned, further Berger/AP Cadding to this year’s record-breaking Editor: Michael Faulkner wildfire insured loss bill. weekend, prompting evacuation orders ance has reported insured losses of +44(0)20 7017 7084 The fire has destroyed 798 structures, for the coastal city of Carpinteria and $9.4bn from October’s fires as of Decem- [email protected] with a further 191 damaged, the Cali- parts of Santa Barbara. ber 1. Loss declarations have so far ac- Deputy editor: Lorenzo Spoerry fornia Department of Forestry and Fire The most destructive wildfire in the counted for up to $1.775bn of this total. +44 (0)20 7017 6340 Protection (Cal Fire) said. However, up state’s history was this October’s Tubbs Travelers said it expects a pre-tax loss [email protected] to 18,000 structures are potentially at fire, which destroyed 5,643 structures of between $525m and $675m from the risk as firefighters struggle to bring the in October. October events, with AIG expecting a Editor, news services: Scott Vincent +44 (0)20 7017 4131 blaze under control. This month’s activity means a quarter bill of $500m, largely through its per- [email protected] Five other fires are also active in of California’s 20 most devastating wild- sonal insurance business. southern California and have destroyed fires on record have occurred within Chubb expects a pre-tax loss of $280m Global markets editor: Graham Village 294 structures combined, the majority the past 70 days. Of the 20 most dam- from the northern California wildfires, +44 (0)20 7017 4020 of which are in San Diego and Los An- aging blazes to hit the state, only 2003’s with its fourth-quarter catastrophe bill [email protected] geles counties. Cedar fire has burned more acres than reaching $320m in total. XL Group ex- Global markets editor: Rasaad Jamie Only four fires in state history have the Thomas fire. pects an October wildfire bill of $200m, +44 (0)20 7017 4103 burnt more acres than the Thomas fire, The ongoing wildfires in southern with fourth quarter catastrophe losses [email protected] which is also now in the top 10 in terms California follow October’s events in reaching $250m. of property destruction. northern parts of the state, which are RenaissanceRe ($90m), Markel ($40m Account manager: Matthew Smith +44(0)20 7017 7894 Having charred a large swath of Ven- expected to cause insured losses of to $80m) and Arch Capital ($25m to $30m) Business development manager: Toby Nunn +44(0)20 7017 4997 tura county last week, the Thomas fire around $10bn. have also made preliminary disclosures Advertising/events: Jefferson Emesibe +44(0)20 7017 4061 entered Santa Barbara county at the The California Department of Insur- of their expected share of the loss. Head of production: Liz Lewis +44 (0)20 7017 7389 Production editor: Toby Huntington +44 (0)20 7017 5705 Subeditor: Jessica Sewell +44 (0)20 7017 5161 Table: Top 20 most destructive California wildfires Events manager: Natalia Kay +44 (0)20 7017 5173 Fire name (cause) Date County Acres burned Structures** Deaths Editorial fax: +44 (0)20 7017 4554 Tubbs (under investigation) Oct 2017 Sonoma 36,807 5,643 22 Display/classified advertising fax: +44 (0)20 7017 4554 Tunnel, Oakland Hills (rekindle) Oct 1991 Alameda 1,600 2,900 25 Subscriptions fax: +44 (0)20 7017 4097 Valley (electrical) Sep 2015 Lake, Napa, Sonoma 76,067 1,955 4 All staff email: [email protected] Witch (power lines) Oct 2007 San Diego 197,990 1,650 2 Nuns (under investigation) Oct 2017 Sonoma 54,382 1,355 2 Insurance Day is an editorially independent newspaper and Jones (undetermined) Oct 1999 Shasta 26,200 954 1 opinions expressed are not necessarily those of Informa UK Ltd. Informa UK Ltd does not guarantee the accuracy of the Butte (power lines) Sep 2015 Amador, Calaveras 70,868 921 2 information contained in Insurance Day, nor does it accept Thomas* (under investigation) Dec 2017 Ventura 230,000* 790* 1 responsibility for errors or omissions or their consequences. Paint (arson) Jun 1990 Santa Barbara 4,900 641 1 ISSN 1461-5541. Registered as a newspaper at the Post Office. Published in London by Informa UK Ltd, 5 Howick Place, Fountain (arson) Aug 1992 Shasta 63,960 636 0 London, SW1P 1WG. Sayre (miscellaneous) Nov 2008 Los Angeles 11,262 604 0 City of Berkeley (power lines) Sep 1923 Alameda 130 584 0 Printed by Stroma, Unit 17, 142 Johnson Street, Southall, Middlesex UB2 5FD Harris (under investigation) Oct 2007 San Diego 90,440 548 8 Redwood Valley Oct 2017 Mendocino 36,523 544 9 © Informa UK Ltd 2017. Bel Air (undetermined) Nov 1961 Los Angeles 6,090 484 0 Laguna (arson) Oct 1993 Orange 14,437 441 0 No part of this publication may be reproduced, stored in a Erskine (under investigation) Jun 2016 Kern 46,684 386 2 retrieval system, or transmitted in any form or by any means electronic, mechanical, photographic, recorded or This list does not include fire jurisdiction. These are the top 20 regardless of whether they were state, federal or local responsibility otherwise without the written permission of the publisher * Fires are uncontained and totals are likely to change of Insurance Day. ** Structures include homes, outbuildings (barns, garages, sheds, etc) and commercial properties destroyed# Source: Cal Fire www.insuranceday.com | Tuesday 12 December 2017 3 NEWS IAG deal lays ground for ‘10% premium boost’ for Flooding in Hamburg after Herwart hit Germany: Perils estimates the storm will cost top three reinsurers insurers €242m © 2017 Bodo Marks/DPA via AP Perils: Storm Sizeable quota-share deal with upcoming renewals could take Zealand. These quota-share agree- the reinsurers’ top-line premium ments, including ceded premi- Herwart to IAG sets up Munich Re, Swiss Re growth to near the double-digit ums, cost IAG A$2.6bn ($1.96bn) and Hannover Re for significant mark, the analysts added. in its 2017 financial year ended cost insurers “While the impact from this June 30, Deutsche Bank said. premium growth as rates set to single deal is small in a group €242m head upwards, analysts say context, it sets the scene for the Prices on the up upcoming renewals,” the ana- The new deal with Europe’s top Extratropical cyclone Herwart will lysts said. “After this deal, the three will reduce IAG’s placement cost insurers €242m ($285.5m), ac- Group (IAG), according to analysts. 2018 top-line growth for those of its gross catastrophe cover from cording to the provisional estimate Lorenzo Spoerry The 12.5% quota-share agree- three reinsurers could approach 80% to 67.5% at the 2018 renewal, from catastrophe loss aggregator Deputy editor ment, which covers IAG’s con- the 10% level.” when prices are expected to in- Perils, writes Scott Vincent. solidated business in Australia, The agreement, the Deutsche crease in the wake of the second The storm most significantly af- New Zealand and Thailand, is Bank analysts added, “overall half’s record catastrophe losses. fected Austria and Germany when alone expected to contribute confirms our positive view on Hurricanes Harvey, Irma and it struck northern Europe on Oc- unich Re, Swiss between €900m ($1.06bn) and the sector”. Maria, plus earthquakes in Mex- tober 29. Re and Hannover €950m in gross written premi- IAG said it signed the deal to ico, are expected to generate an The storm’s rapid passage Re could see 10% ums, or 2% to 3% of the total reduce its earnings volatility and insured loss of about $100bn, meant its extreme winds only last- top-line growth in growth for these reinsurers, capital requirements.
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