2017 insured losses could total $100 billion: RMS
Total losses from recent natural catastrophes could hit $100 billion and the industry needs to look at its exposures and learn lessons to help it manage its risks better, John Kapitan, head of Americas client development at RMS, told PCI Today.
“All the recent events could add up to a $100 billion insured loss year, which for the industry is significant,” said Kapitan. “That highlights the need to have effective risk management and to be thinking about all the different events that could happen in a year.
“If Irma had moved and taken a different track then we could have been talking about a $150 billion or a $175 billion loss year. Companies without highly effective risk management could be in distress at that point.
“We are hearing more about the wildfires in California. That could become a significant loss—we’re estimating $3 to $6 billion, but it is evolving.”
Kapitan said it is important for companies to understand their exposures and the coverage they are providing. They need a plan in place to address what happens if, as seen in 2017, multiple events happen. They need to understand what their overall aggregate loss could be.
According to Kapitan, the industry has made significant recent improvements in exposure management but he stressed that there was always room for more improvement, especially given the wide range of events the market has seen in 2017.
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