Boston — As the hurricane season begins, statistics and research indicate catastrophes and their repercussions should be top of mind for insurers. A report recently completed by Boston-based catastrophe risk modeling firm AIR Worldwide Corp. estimates that over the past three years the insured value of properties in coastal areas of the continued to grow at a compound annual growth rate of just over 7%. Despite the recent weakening of the real estate market in many areas, the insured value-or the cost to rebuild properties-has maintained an annual growth rate that will lead to a doubling of the total value every decade.
"While the scientific debate over the effects of global warming on the frequency and severity of hurricanes remains inconclusive, there is no question that the significant increase in the number and value of exposed properties over the last decade has and will continue to contribute to increasing hurricane losses for insurers," says S. Ming Lee, president and CEO of AIR Worldwide.
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