Insured losses attributable to Superstorm Sandy will exceed $20 billion, according to an update from Fitch Ratings, and based on loss estimates from individual companies totaling $16 to $17 billion so far, or just below insured loss estimates from third-party catastrophe modelers.

Credible loss estimates have been difficult to create due to the size of the affected areas, particularly with respect to flooding and business interruption claims, which has contributed to the uncertainty in estimating losses. Several larger insurers still had not reported estimated losses at the time of the report’s publication, which could add another $5 billion or more in losses. The size and duration of Sandy also means that commercial lines suffered larger proportional losses than personal lines.

“Primary writers with substantial Northeast catastrophe exposures are incurring the most significant losses, with reinsurers taking a more reduced, although still meaningful share,” Fitch said. “While many of the typical property lines of insurance are being impacted, it was a particularly outsized event for auto losses and marine insurance.”

Fitch also said the storm resulted in manageable losses due to “the favorable spread of loss and limited concentration risk among individual insurance companies.” But there were areas related to flood risk exposure that the models did not fully capture, and companies did not fully anticipate, despite robust modeling.

Sandy likely will not change market underwriting capacity, nor lead to a hard property market, Fitch said, and reinsurance renewals pricing at January 1 indicate that Sandy helped stabilize rates. Although loss impacted business experienced more significant rate increases, property catastrophe pricing in the United States is flat to up slightly overall.

For reports on the performance of individual insurers' performances in the wake of Sandy, check out our slideshow, "24 Insurers Evaluated on Sandy Claims Performance."

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