Following Hurricane Katrina in 2005, former U.S. Vice President Al Gore described it as “the first taste of a bitter cup that will be proffered to us over and over again.” Executive SummaryInsurance and reinsurance are essential to society’s resilience following natural catastrophes, but for some reason the industry is having a hard time selling this protection at a sustainable price, says Moses Ojeisekhoba at Swiss Re.
That devastating event killed more than 1,800 people and in economic terms still ranks as one of the costliest tropical cyclones on record. Al Gore certainly proved to be correct: The cup keeps being proffered to us, and that cup was very bitter in 2017.
The severe catastrophes last year, including Harvey, Irma and Maria, resulted in the loss of some 11,000 lives. Also homes, business and livelihoods were destroyed, causing economic losses of $337 billion. The insurance industry could foot part of that bill ($144 billion), again demonstrating that insurance and reinsurance are essential to society.