Calamities Natural and Political: Implications for P/C Insurance

This PowerPoint report, presented by the senior vice president and chief economist of the Insurance Information Institute, at the Midwestern Actuarial Forum, focuses on natural and political disasters and how they impact the property/casualty (P/C) insurance industry. The first section takes an in-depth look at superstorm Sandy, highlighting insured losses and flood losses, among other statistical data, and comparing its impact to earlier storms. A further section looks at catastrophes that threaten the Midwest, including tornadoes, hail and wind. The section on political calamities discusses several potential obstacles that could influence P/C insurer growth opportunities. They include budget battles in Congress, fallout from the financial crisis in Europe, the possibility of a middle-east crisis, whether the Terrorist Risk Insurance Act will be reauthorized and how a new Housing and Urban Development (HUD) ruling will affect property insurance. The report explains that the HUD ruling prohibits discrimination in the sale, rental or financing of dwellings on the basis of race, color, religion, sex, disability, familial status or national origin, and allows plaintiffs to use statistical analysis to show that certain insurer, lender or municipality behavior had a disproportionately adverse effect on the sale, rental or financing of housing for minorities.