Yesterday's terrorist attacks in the US are likely to have a severe impact on the insurance ind...
Yesterday's terrorist attacks in the US are likely to have a severe impact on the insurance industry, which could be facing the largest claims in history. Businesses have been warned that the events could bump up the cost of premiums significantly.
Lloyd's of London could be badly hit because it is renown for offering companies cover for terrorist attacks. Lloyd's also has around 30% of the aviation reinsurance market and is believed to have some exposure to the World Trade Centre. The world's second largest reinsurer Swiss Re has assured commentators that potential US damage claims will not jeopardise its corporate strength.
At first guess, Swiss Re expects the size of the claims to be at a similar levels to those as a result of the 1999 Lothar and Martin winter storms. Lloyd's says it needs 48 hours before it can calculate an initial estimate of the effect the attack will have on the insurance market. Other industry commentators estimate that it will take at least until November for an accurate assessment of the damages to be given.
Insurers' shares have slumped with Swiss Re, Munich Re, Generali, AGF, Zurich Financial, ING and RAS all posting significant declines.
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