News


WEDNESDAY 10.31.12


Market is moving in the right direction


Although things remain tough, the market is moving in the right direction on both the property and casualty sides, says Ed Jordan at Tokio Millennium Re, which is focused on building its casualty business.


renewals and several factors are conspiring to keep the industry on an even keel. Hurricane Sandy will ensure property-catastrophe rates remain stable and certainly prevent any downward pressure from buyers, while the casualty market sees little change with rates subtly shifting upwards in some lines. That is the broad analysis of Ed Jordan, chief un-


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     speaking at this year’s PCI conference in Dana Point, California. On Hurricane Sandy, he also notes that it will be interesting to see how accurately the models pre- dict the expected storm surge, an element of the models that was further developed after Hurricane Katrina. Jordan is also taking a close interest in the de-


velopment of the casualty market at the moment. TMR began writing casualty a couple of years ago and is slowly building a portfolio. Jordan says this has not been easy as rates in most lines remain soft and the company does not have any prior year reserves it can rely on if rates are inadequate.


(continued from page 1) “It is estimated that there is be- tween $18 billion and $33 billion of loans uninsured for earthquake risk out there, and a large propor- tion of this will sit within Fannie Mae and Freddie   no earthquake coverage and that is quite a problem  Nutter suggests that, should the private rein- surance sector become more involved in such pro- grammes, it could help drive demand. This would  in this sector; consumers, by ensuring adequate coverage is in place; and the reinsurance sector by driving growth and adding diversity to individual companies’ portfolios.  


in Florida. Florida Citizens Property Insurance, the state-owned insurer, transferred risks into          through a $750 million cat bond and a tradition-


Ed Jordan, Tokio Millennium Re “We moved into this area because of the diver-


   property-catastrophe underwriter so this offers us a different use for our capital. We also offer something different in this market because of our high rating,   And despite tricky underwriting conditions,


Jordan believes the underlying trend is broadly positive with some small increases starting to come


al reinsurance placement of a similar size. “It is yet another example of the desire we are seeing -  Finally, the Terrorism Risk Insurance Act


(TRIA), created in the aftermath of September 11th to stabilise the insurance market covering terrorism risks, is due to be renewed in 2014. Nut- ter says early indications are that the federal gov- ernment will seek greater participation from the private sector in the way it structures the new act. “They could increase retentions or trigger points – there are a number of ways of doing it. - pation by the private sector in risks traditionally dealt with by government. Reinsurance growth  capital has entered the industry. If the RAA can help push more risk into the reinsurance industry 


2 | INTELLIGENT INSURER —PCIAA TODAY | Wednesday October 31 2012 Wednesday 10.31.12


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through. The company is focused on a number of professional lines, medical malpractice business and excess casualty business. It writes business both on a quota share and excess-of-loss basis. “I wouldn’t go so far as to say it is hardening


but we have moved into this business for strategic reasons, and while it is tough the market is certainly 


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