A.M.BestTV: How Katrina Changed Today's Insurance Industry

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FOR IMMEDIATE RELEASE

OLDWICK - JULY 31, 2015 11:40 AM (EDT)
This ^A.M.BestTV episode looks at how insurance has brought new understandings and ways of dealing with catastrophe risks and complex losses 10 years after Hurricane Katrina devastated Louisiana. Click on http://www.ambest.com/v.asp?v=katrina715 to view the video program.

Hurricane Katrina was a Category 3 storm that caused the largest insured loss for the insurance industry and had an economic loss of an estimated $125 billion. The storm was also a changing event for the insurance industry.

"Katrina was an eye-opener on storm surge and flooding exposure," said Jamie Miller, managing director and head of property at Swiss Re Corporate Solutions. "And 10 years later, there is still a lot of ongoing debate on the impact of surge and wind concerning losses and events. It is not that the industry can't manage them, but a decision has to be made as to how to manage them."

"It was a vertical loss, which means it pierced through a lot of programs, more than a number of underwriters thought could happen, and post-Katrina, a great deal of carriers were surprised by the ultimate losses they faced, " said Rick Miller, property practice leader at U.S. Aon Risk Solutions.

Although catastrophe models have improved, challenges still remain. "The risks keep rising because of the constant building along the coastline of the United States," stated Dominic Casserley, chief executive officer at Willis Group Holdings. "Recognizing the potential fragility of our infrastructure, there is over $10.5 trillion of exposures along the coastline, so the risks are still there."

Other people who appear in this episode include:

• Jim Donelon, commissioner of insurance, Louisiana;


• Dan Riordan, chief executive officer at Zurich Global Corporate in North America;


• Joseph Tocco, chief executive, Americas at XL Catlin;


• Duncan Ellis, managing director and U.S. property practice leader at Marsh;


• Jeremy Johnson, president and chief executive officer at Lexington Insurance Company; and


• Mario Vitale, chief executive officer at Aspen Insurance and president at Aspen U.S. Insurance.

Recent episodes of ^A.M.BestTV include:

• Analytics Continue to Transform Insurance Industry: How big data and analytics continue to play an ever increasing and important role in the insurance industry. Two just released industry reports from Novarica and Capgemini explore how insurers are looking to harness data across all facets of business: http://www.ambest.com/v.asp?v=bigdata715.


• Insurers Develop New Ways to Trigger Disaster Coverage: Brokers and insurers are borrowing from the catastrophe bonds world by developing coverage against natural perils that are triggered by measurable parameters rather than traditional claims reporting: http://www.ambest.com/v.asp?v=parametric715.


• Insurer Mitigates Wildfire Damage With Tree Effort: The Philadelphia Insurance Companies is partnering with the Arbor Day Foundation to mitigate disaster prevention, namely wildfires, by planting 80,000 trees: http://www.ambest.com/v.asp?v=arbor715.


• For Marine Insurers, Bigger Ships Carry Bigger Risks: Marine insurers talk about the challenges they face as new vessels that can carry up to 20,000 containers impact pollution and increase the risks to cargos, hulls and cyber systems, as well as political risk, since the marine industry has a global presence: http://www.ambest.com/v.asp?v=marine715.

^A.M.BestTV covers exclusive A.M. Best information and reports, targeted topics and key developments in the (re)insurance industry every Monday, Wednesday and Friday. Sign up for alerts of episodes at http://www.ambest.com/multimedia/ambtvsignup.html. View ^A.M.BestTV episodes at http://www.ambest.tv .

A.M. Best Company is the world's oldest and most authoritative insurance rating and information source.