June 2010/5

The Property Casualty Insurers Association of America (PCI) has voiced "deep concern" over potential conflicts between state regulators and the proposed Federal Insurance Office (FIO) - which edged a step nearer to coming into existence last week on Capitol Hill.

Trading of 2010 catastrophe derivatives on the Chicago Mercantile Exchange (CME) and Chicago Climate Futures Exchange (CCFE) has reached $66mn, as the first named storm in the US wind season threatens to make landfall.

The fatal flash floods that struck southern France on 15 June, killing 25 people, are set to cost insurers nearly EUR700mn, according to estimates from national industry body Fédération Française des Sociétés d'Assurance (FFSA).

Alex, the first named storm of the Atlantic hurricane season, is expected to cause little concern for insurers, but forecasters anticipate a destructive - and expensive - season ahead.

The future of the US National Flood Insurance Program (NFIP) continues to hang in the balance after a bill to extend the lapsed government insurance scheme failed to make it to a vote in the Senate last week.

The investment return slump in the last five years has shifted the onus onto underwriters to generate (re)insurance profits, according to the Property Casualty Insurers Association of America (PCI).

The aggregate industry reserve base in the US actually strengthened in 2009, despite growing concerns over the reserve adequacy of property casualty insurers, according to Conning Research & Consulting.

US property and casualty (P&C) insurer financial impairments have more than tripled since 2007, rising to 18 in 2009 from 16 in 2008, according to a study by AM Best.

Tom Bolt, director of performance management at Lloyd's, is bearish on sector prospects and is especially concerned about "unsustainable" reserve releases in the casualty market, according to analysts at stockbroker Collins Stewart.

London market wholesaler Price Forbes & Partners said last week that it was opening a reinsurance arm after hiring a senior HSBC executive.

Independent London market (re)insurance broker Thomson Heath and Bond Group (THB) saw fees and commissions rise 5 percent in the first half of 2010 to £24.6mn, fuelled by organic growth and a stronger US dollar.

New regulator is a missed opportunity to streamline byzantine US regulation