Recent catastrophic activities, whether they be the Caribbean/US hurricanes or the two earthquakes in Mexico, have been a timely reminder of the importance and value of the (re)insurance market.
Keith Harrison, CEO, UK & Europe, JLT Re
The recent catastrophic activities will have a significant impact on (re)insurance markets around the world, but one of the biggest tests will be how the industry responds to its customers’ needs.
These large losses have highlighted the lack of private insurance take-up for flood and this is just one of many examples of a global protection gap.
Gap in flood insurance cover
The fact that in Houston just 10% of households have flood insurance, which drops to 1% in the outer regions of the city, and that the economic loss from Harvey will be more than five times the insured loss, should be something that the insurance industry and regulators alike are focusing on.
Inevitably, post such catastrophic events, there is a natural instinct from the (re)insurance industry to recoup losses by re-evaluating pricing and to mitigate future losses by tightening coverage.
However, these are events that have led to the loss of lives and livelihoods.
So, while in some cases a proportionate re-evaluation of (re)insurance terms and conditions is merited, insurers, reinsurers and brokers alike should not ignore the importance of quick and robust claims payments and the need to deliver ongoing service, products and coverage that meet clients’ needs and do so at a fair value.
Perhaps if the (re)insurance industry responds in a positive, ‘can-do’ way, we can make inroads to the insurance protection gap and/or deliver the innovative reinsurance solutions that our clients really need.
Here at JLT Re in London that’s our focus right now!
Please contact Keith Harrison on +44 (0)20 7886 5308 or email@example.com
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