Reinsurers Don’t View Irene As Major Event.
<table cellspacing="0" cellpadding="0" border="0"> <tbody> <tr> <td align="right">Copyright: </td> <td>(c) 2011 Crain Communications, Inc.</td> </tr> <tr> <td align="right">Source: </td> <td>Cengage Learning</td> </tr> <tr> <td align="right">Wordcount: </td> <td>294</td> </tr> </tbody> </table> <!-- start_body --><br /> <p>The global catastrophe reinsurance industry may have dodged the proverbial bullet when Hurricane Irene failed to generate the magnitude of losses many observers had feared.</p> <p>Although the late August storm's heavy rains caused severe flooding throughout much of the <location>U.S. East Coast</location>, Irene did not end up packing winds as high as initially predicted.</p> <p>According to catastrophe modelers, the storm ultimately may cause as much as <money>$6.6 billion</money> in insured property damage. Flood damage to homes is not covered by most homeowners' insurance; rather, it is available through the U.S. government's National Flood Insurance Program.</p> <p>Flood damage, however, is covered under some commercial property insurance policies.</p> <p>Reinsurers already were battered by <money>$70 billion</money> or so in losses from a spate of catastrophes such as the Japanese earthquake and tsunami: the earthquake that destroyed a significant portion of downtown <location value="LU/nz..chrchh" idsrc="xmltag.org">Christchurch, New Zealand</location>; and bad weather across much of <location value="LC/us" idsrc="xmltag.org">the United States</location> during the first half of the year. But they may be spared significant losses from Irene.</p> <p>Irene will be more of an insurance event than a reinsurance event, said <person>W. Marston Becker</person> , president and CEO of <location value="LU/bm..hamton" idsrc="xmltag.org">Hamilton, Bermuda</location>-based <org value="Bermuda:ALTE.BH" idsrc="xmltag.org">Alterra Capital Holdings Ltd.</org></p> <p>A loss of up to <money>$10 billion</money> is more of an insurer loss than a reinsurance event because of insurer retentions, said <person>Bill Pollett</person> , senior vp of <location value="LU/bm..hamton" idsrc="xmltag.org">Hamilton, Bermuda</location>-based <org value="NYSE:MRH" idsrc="xmltag.org">Montpelier Re</org>.</p> <p>Irene weakened to a tropical storm by the time it reached <location value="LU/us.ny.nyc" idsrc="xmltag.org">New York</location>, lessening the damage it caused, said <person>Ulrich Wallin</person> , chairman of the executive board of <location value="LU/de..hanver" idsrc="xmltag.org">Hanover, Germany</location>-based <org>Hannover Re Group</org>.</p> <p>"It will be a loss for us but not a major loss," <person>Mr. Wallin</person> said. "We expect a low double-digit figure, but it is too early to give a precise figure."</p> <p>Copyright 2011 Crain Communications Inc. All Rights Reserved.</p>
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