An approach of over 1,000 re/insurance industry participants has found an expectation for costs to run above $5 billion after multiple US states were swarmed unexpectedly by tornados.
53% of respondents to our survey said the industry should expect a bill higher than $5 billion, with 37% predicting a figure between $2.5 billion and $5 billion.
Earlier this week catastrophe risk modeller KCC pegged the insurance industry loss at around $3 billion.
Aon analysis of the event echoed other outlets in its expectation for both economic and insured losses to reach into the billions of dollars.
It’s important to note that the widespread scope of the damage footprint will require a prolonged period of assessment to gain a full view of the event.
In a slightly earlier assessment, Argenta said industry losses could run as high as $7 billion.
However Guy Carpenter has since stated that commentary alluding to $7 billion+ in losses could prove to be on the aggressive side.
At this time, only a limited portion of the loss is expected to be ceded to reinsurance.
AM Best expects losses to be concentrated in the commercial multiperil and homeowners lines, with some losses borne by auto physical damage.
Overall there’s a belief among analysts that, despite it still being too early to fully assess damage, the industry is well capitalised enough and has adequate risk management programs for this to be an earnings event for the industry.