The insurance industry is feeling the pain from this year’s devastating hurricane season. According to a November 22 piece on the website Insurance Journal, the natural disasters during the second half of 2017 are expected to cost the insurance industry nearly $100 billion this year. The 2017 hurricane season is tied for the fifth most active in history; it includes not only hurricanes Harvey, Irma and Maria, but also 14 other named storms and an earthquake in Mexico.
The Insurance Journal piece cites a report by the Swiss Re Institute that predicts substantial rate hikes for 2018 and 2019, particularly in the hardest hit segments of the insurance business. Swiss Re’s chief economist says it isn’t just the extensive natural disasters that have cost the industry money, but also soft underwriting conditions and low investment yields. He expects conditions to improve in 2018 as rates harden and premiums rise.