Lloyds of London the worlds largest reinsurance market has just instituting new premium policy for catastrophic loss in the US. reinsurance premium have risen by 50% starting July 1, 2023.
This is catastrophic for the US insurance market, because it means that large US insurance company are no longer able to offload part of the catastrophic loss risk that has grown exponentially over the past decade or so.
We have already seen an important shift with the disappearance of casualty insurance in California and Florida, because of either fire risk in California or flooding and hurricane risk in Florida.
The most interesting aspect of the US right view of global warming is it inability to understand how others will view it. The reinsurance market, cares little for US policy or politics. They are entirely driven by profits and right now in California and Florida the risk is no longer worth it, catastrophic losses in US insurance markets has made this market unappealing to the global market place for insurance
It matters little what the GOP presidential nominee says about insurance and or the lack there of the reality is the market is cold in addition, did US has cut its only source of domestic pure, catastrophic coverage by the recent reduction in US federal expenditure. In fact, the GOP‘s own policies in Congress and the Senate have ensured that is more difficult now for Americans to obtain insurance because the lifeline of the government is no longer available
There is no doubt that a doubling of premium for catastrophic insurance in the US has a massive impact on the US insurance industry. It’s unclear how insurance company will deal with the issue at this time. One thing they have done already is reduce in the most expose region to the risk of catastrophic losses that’s how the market reacts.
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