Best’s News & Research Service - September 10, 2021 04:08 PM (EDT)
BestWeek: Sept. 11 Attack Changed the World’s Perception of Risk
OLDWICK, N.J. //BestWire// - The U.S. government backstop for terrorism risk has helped bolster business insurers’ capacity and enabled growth in commerce over the past 20 years, according to this week’s BestWeek.
Thomas MountThomas Mount, senior director, and Christopher Graham, senior industry analyst, both of AM Best, recently discussed the Best’s Special Report “TRIA Has Generally Been Credit-Positive for Insurers.”
“Before Sept. 11, terrorism risks were considered part of any other risk to any insurance policy. There was no special treatment, no special exclusions. It was all wrapped in,” Graham said. “There hadn’t been much in the way of terroristic events on U.S. soil for there to be any historical analysis, so no one gave much thought to it prior. Obviously, Sept. 11 changed that for us.”
Also featured in this week’s BestWeek:
— Catastrophe risk modeler RMS said Hurricane Ida could cost insurers and the National Flood Insurance Program between $25 billion and $35 billion for onshore and offshore losses in the Gulf states.
The total excludes wind and inland flooding impacts in the Ohio Valley, Mid-Atlantic, and Northeast until the full extent of damage is known, the company said in a statement.
— Insurers face another $5 billion to $8 billion of residential and commercial flood losses related to Ida after the storm’s remnants dumped six to nine inches of rain over three hours in New York, New Jersey and surrounding states, according to CoreLogic.
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AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.
(By Rick Cornejo, managing editor, BestWeek: Rick.Cornejo@ambest.com)