International reinsurers’ share of insured losses from 2011 U.S. tornadoes is likely to be about $2.5 billion, or roughly 17% of total insured losses, according to analysis by the Association of Bermuda Insurers & Reinsurers.
ABIR President Bradley Kading told Out of the Storm News that most of the losses from the April and May tornadic outbreaks – estimated in June by Aon Benfield to total about $21.65 billion, with $15 billion of insured losses – would be borne by primary insurers. Kading estimated European reinsurers would absorb slightly more than half the $2.5 billion in reinsurance claims, with Bermuda companies accounting for another 40%.
According to Aon Benfield’s Impact Forecasting unit, the 2011 losses were nearly three times the average annual severe weather loss from 1990 through 2010.
Missouri Insurance Director John Huff recently released his department’s estimate that insurers have paid more than $1.1 billion in home, auto and commercial policy claims related to the May 22 Joplin, Mo. tornado, with a projection that the total would rise to about $2 billion when all is said and done.
However, while crediting the industry with having “done a commendable job responding to the tornado,” Huff noted that some property owners are having difficulty rebuilding within the time limits set by their policies, which in some cases might be unreasonably stringent.
“Missouri law requires insurers to provide prompt, fair and equitable settlements to their policyholders, and rigid deadlines may violate that law,” Huff said in a statement.