Insurers in the Bahamas have passed on the bulk of their losses from hurricane Matthew to the global reinsurance industry and are now that reinsurance rates are increasing at their renewals.
Summit Insurance has now paid out $37 million in hurricane Matthew claims, the Bahamas Tribune reported, but the insurer has noted that it may have to increase its rates, as reinsurers increase their pricing after the loss.
The Bahamas is estimated to have suffered around a $400 million insurance industry loss from hurricane Matthew, but local insurers have only paid around half of that amount, with reinsurance arrangements shouldering the remainder of the burden.
“We have seen some reinsurers pushing rates northwards because of their losses”, Tim Ingraham, President of Summit Insurance Company, told the news outlet.
At this time the extent of any price increases for insurance consumers is uncertain, as reinsurance pricing hasn’t yet flowed through to impact insurers ability to keep rates down. But local insurers are said to be expecting some increases in their reinsurance costs, so there is likely to be some knock-on effect to their product pricing.