Louisiana Insurance

Assekuranz estimates for the total insured damage from Hurricane Katrina are being a little large and rapidly changing - above $ 25 billion to 60 billion dollars. But Standard & Poor’s, remains sceptical about the reliability of these figures. On this point, we can say with confidence that projected losses have increased dramatically with the initial estimate.

S & P has rated personal online trading lines and reinsurance companies, as well as loan and mortgage insurers insurer. On September 9, Standard & Poor’s Ratings Services Credit Watch with a negative impact on their rating of the evaluation 10 insurance and reinsurance with groups vis-à-vis the exposure and without the catastrophic losses of Hurricane Katrina (see list). The ratings on insurers with potential losses in the expectations have not been on Credit Watch in this period.

Compared to their credit ratings companies Watch sufficient risk management and risk reduction measures skills, capital and liquidity for the losses they are likely. It is however an abnormally high level of uncertainty is the assessment of the extent of rights they may face, and the standard models used in industry for predicting catastrophic losses from hurricane scenarios might be not all risks involved in the game now. Given that most companies, to a large extent on these models to price developments and their risk management policy, insurers and reinsurers with the greatest exposure in general are not yet capable of fully appreciate the magnitude of their potential losses.

Currently, we believe that most of these risks has the greatest impact on commercial lines insurers and reinsurance providers. Personnel of enterprises in significant losses of lines.

NO CERTANTIES. S & P and its comments on life insurance and health insurance. However, few make an assessment of life and health insurance have significant concentrations of risk to the markets concerned, especially because of their geographic diversity General or the home. Admittedly, there are some business interruption, reduced turnover, higher expenditures and perhaps even the insured loss in the context of overall income and financial resources in most companies evaluated, no votes will be probably affected.

The Credit Watch Highlight stages of persistent insecurity in the equipment sector precise quantification of assurance’s ultimate exposure. However, demotions are not inevitable. S & P reunion will soon be available with the management companies on Credit Watch and awaits a solution to the status of most cases today, within 90 days. The status of the ratings of several companies, but could also take longer to resolve.

In addition, the overall situation remains quite uncertain, another burden on the risks of developing contingencies may require more credits Watch places.

What are the companies. The list of insurers and reinsurers, with notations on the appropriations Watch with negative implications follows. Suppose that the additional capital will not be perceived as losses grow larger quantities ratings are reduced, and those who are concerned decreased by more points:

ACE (ACE): The rating (Counter Party credit rating BBB +) on Credit Watch has been negative, since the result perhaps expectations are not met, on the basis of insecurity and the amount of hurricane Katrina losses. If S & P decides to lower the rating of the ACE, it is unlikely that this note is reduced by more than one notch.

Allmerica Financial (AFC): The decision of the rating on Allmerica Financial (BB) and its claims of member organizations on Credit Watch is based on its significant exposure in Louisiana, especially in owners of commercial buildings and multi-risk . If the insured, the real damage Katrina are much higher than current estimates of industry, then Allmerica net loss could have a significant impact on its activation.

Allstate (ALL): The decision of all classifications Allstate (A +) on Credit Watch with negative effects was based on the high degree of uncertainty with regard to companies on the potential loss exposure Hurricane Katrina’s devastating impact on Louisiana, Mississippi and Alabama. In addition, Allstate does not have reinsurance protection in these countries.

Society of Lloyd’s: Credit Watch placement reflects the uncertainty about the magnitude of the consequences of Hurricane Katrina on Lloyd’s (A), whose specialties insurance and reinsurance of offshore energy installations, damage hardware and operating interruptions. Since Lloyd’s is a market, it is in the process of collection, validation and aggregation of data from each of its unions and publish estimates, if the transaction is completed.

“Katrina” gives rise to questions, demand flow supply, reinsurance recovery and liquidity. Standard & Poor’s does not expect that the payment of market capacity affected, but. Standard & Poor’s will meet with management to resolve the Credit Watch placement. If, after the dissolution of the Credit Watch placement Standard & Poor’s decides a reduction in the rating on Lloyd’s accounts, it is unlikely that companies, plus a notch.