Unplaced reinsurance coverage expected at year-end
a property catastrophe reinsurer said this week.
"It's very obvious that it is going to be a late renewal season,'' said International Property Catastrophe Reinsurance Company Ltd. senior vice president, underwriting, Mr. James Bryce.
"Everyone is going to logjam into December. Next week we will probably start to see the clients approving the terms for purchase for 1/1/95 (the January 1 renewal date for reinsurance purchase).'' Part of the problem is the way the holidays are consuming the weeks leading up to the renewal date, beginning in the US with the Thanksgiving holiday yesterday.
"The whole process for renewal has started so late that I envision a logjam and there will be some unplaced coverage at 1/1/95. It is too early to see a clear trend in the pricing, except to say it will be a busy December,'' Mr.
Bryce said.
"This year, Christmas falls on a Sunday, which means a holiday on Monday and then a bank holiday on Tuesday, when the British (and Bermudians) will celebrate Boxing Day.
"So we have three working days for that week and then the Friday in the States, the clerical and back-up staff will be trying to get away early to begin their New Year's holiday. So you have less than three working days, when the attachment date is Sunday. And you've lost Saturday.
"Then New Year's is on a Sunday, which means another bank holiday on Monday, January 2.
"I think it is pretty apparent that the season is going to be very late.
We're going to be giving the first priority, as I'm sure everyone will, to existing customers, that is our old clients.
"We're always interested in new business, but that will take a second ranking over the priority of our existing customers. With our abbreviated work week, I don't see how all the programmes are going to be placed.'' This week, the business news service Bloomberg reported that Paragon Reinsurance Risk Management Services Inc. had stated that their Catastrophe Price Index for property insurance showed a 16 percent decrease in the relative price for renewals at July 1, compared to July 1 a year ago.
