New Orleans Insurance

The assurance of the economy is either resilient or arrogant - or maybe both.

After a year of the hurricane hit the worst in the history of the industry, insurers are thriving. Several premium increases, and cutting coverage, be prepared to some, the purchase of its own stock or acquire other businesses.

“The sector has succeeded in mass casualties of the 2005 hurricane season and appreciates the benefits and health checkups, which is the result of a drive to continue,” said Standard & Poor analyst Simon Marshall. A drive a market where it is difficult for customers to obtain insurance and insurance companies, the premium.

Last year, claims cost insurance 57 billion in three “super-storms, including Hurricane Katrina, which devastated New Orleans.

Insurance experts predicting another bitter Atlantic hurricane season begins on 1 June, with no fewer than five major hurricanes expected that the Slam USA.

But insurers have sufficient funds available to pay claims. Some are so flush they indicated reserves of repurchases or acquisitions, despite the large claims of two employees unusual storm seasons.

While the 2005 hurricanes Property Casualty held airline in 2005, premiums have increased by 2.2% to $ 481.8 billion, after AM Best, industry prices. The fortune grew by 8.3% to $ 1.3 trillion fear that homeowners and businesses bought more.

American International Group (AIG), one of the biggest insurers, he said in March could control another year 2004, when the storm blew or washed away $ 27 billion of insured property, especially in Florida.

But AIG plans to reduce coverage of 20% to 25% in areas of disasters, such as New Orleans. And it is also the wind and tide to share as much as 5% and premiums increase by 30%, Kevin Kelly, Chairman and Chief Executive of AIG’s Lexington Insurance.

A new Florida insurer wants a premium of 92% increase.

Allstate (ALL), which is not politics in Louisiana, he wrote to reinsurance, posting losses of $ 3 billion, after Katrina and Rita broke the Gulf Coast.

For fear of another hurricane could from the East Coast, Allstate cut its owner, exposure as far north as New York City.

Réassureurs, sell safeguarding the retail sale of insurance coverage paid more than $ 20 billion in hurricane claims and forcing airlines such as Quanta Capital Holdings and PXRE (PXT) to consider the sale or liquidation.

But private equity and hedge funds are now flooding in the reinsurance market, seeking to profit by increased premiums. You’re 18, $ 6 billion to buy reinsurers in Bermuda, where a large part of the market, according to a study by British Insurance broker Benfield.

“If each sector is under a cloud, it is an excellent time for: - if you know where the opportunities,” said Prakash Melwani, Senior Managing Director of The Blackstone Group, has invested reinsurers Aspen Insurance Holdings (AHL) Axis Capital Holdings (AXS) and Ariel Reinsurance.

There are signs that the industry longer-term prospects may be less rosy.

Risk Modeling, under strong loss last storm to strengthen their projected loss of at least 40% and rating agencies require insurers to keep more reserves to cover potential losses.

Superior probable reserves, with pressure from the authorities not to raise rates, Squeeze profits.

“Before 2010, we could see $ 100 billion in catastrophe losses in a single year,” said Robert Hartwig, chief economist at the Insurance Information Institute.