Reinsurance News

The next cat quarter should be light for US carriers: Morgan Stanley

20th April 2022 - Author: Katie Baker

According to Morgan Stanley, the next catastrophe quarter should be light for predominantly US carriers. However, on a global scale, analysts warn that catastrophes will likely impact reinsurers and primary insurers with international exposures.

Catastrophe losses in the US lay somewhere in the several hundred million dollar range according to Aon reports, and should be much lower than the previous year which contained the $15 billion impact from Winter Storm Uri.

As noted by analysts, Allstate did not pre-announce catastrophe losses for January or February, meaning losses did not meet the firm’s $150 million per month reporting threshold.

Additionally, Progressive reported QTD cat losses of just $29 million, which is also on the light side. And while analysts feel that some late season storms could reach into the hundreds of millions dollars and therefore could impact results, they believe these will be manageable overall.

When it comes to international losses, however, which have been fairly outsized this quarter with several multi-billion dollar invents including Australia floods, the Japan earthquake, and EU winter storms Dudley and Eunice, it’s a different picture.

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Ultimately, Morgan Stanley expects largely US domestic insurers to have a fairly light cat loss quarter, with estimates down YoY and slightly lower than historical first quarter averages. However, analysts expect reinsurers and international exposed carriers to bear the brunt of global cat losses this quarter.

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