Chicago and London —Assuming only limited additional turbulence in the financial markets and no significant reinsured catastrophe losses, reinsurance intermediary and capital adviser, Aon Benfield, expects that the April through July reinsurance renewal market will be similar to the Jan. 1, 2009, market with U.S. hurricane and earthquake reinsurance pricing rising modestly, and pricing of other global natural perils holding firm.
However, according to Aon Benfield’s January 2009 Reinsurance Market Outlook, U.S. hurricane dominated programs, especially those exposed in the state of Florida will likely experience more significant price increases than others due to the potential inability of the Florida Hurricane Catastrophe Fund (FHCF) to fully finance its projected 2009 capacity in the uncertain municipal bond market. The loss of significant optional FHCF capacity or less confidence in its claims paying ability may greatly impact reinsurance renewals for Florida residential property insurers.
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