While industry losses from hurricane Milton may not be as high as had initially been feared, the storm’s impacts in Florida are still expected to be a loss in the tens of billions of dollars, and alongside loss experience in the sector to-date this can still drive property catastrophe reinsurance rates higher at the January renewals, KBW has said.Citing Gallagher Re’s pre-landfall estimate for between $30 billion and $40 billion of industry losses from hurricane Milton, KBW’s analyst team note that, “The hurricane’s relatively rapid weakening and its landfall location (not a direct hit to Tampa) suggest insured losses closer to the lower than the higher end,” of that range.They further explain that it’s “too early to pinpoint a loss estimate.” Adding, “We expect Milton’s losses to drive property catastrophe reinsurance rates up y/y during the January 1, 2025 renewals, but lowered reinsured losses imply lower pricing increases.” So the analysts are suggesting Milton may be a sufficiently large industry loss to halt any softening of property catastrophe reinsurance, perhaps resulting in some increases at January 1 2025 renewal contract signings.First-half 2024 global insurance industry catastrophe losses were estimated at between $60 billion and $66 billion by most of the firm’s we track.

The third-quarter is likely to see around $30 billion added to that total, with the possible double-digit hurricane Helene likely to be the largest single event of that quarter.Now, hurricane Milton in early Q4, could add a further $30 billion plus in losses to the total, which would take industry catastrophe losses for the year to somewhere around the $120 billion or higher level, it now seems.That is another expensive year of weather and natural catastrophe losses for the industry and the fact two relatively meaningful loss events have occurred in Florida, while five land-falling US hurricanes have been seen, this could all be sufficient to increase reinsurance capital providers desire to ensure they are adequately compensated for the risk they assume.

After the recent Monte Carlo Rendez-Vous industry event, which was before hurricane’s Helene and Milton, .Now that seems less likely, analysts suggest.Remember Goldman Sachs analysts had also said .

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