Analysts at Barclays believe that the unprecedented level of losses caused by February’s Winter Storm Uri in the US could be ‘setting the stage’ for another above-average catastrophe year for re/insurers.
Current industry loss estimates put the cost of Uri in the $15 billion to $18 billion range, which Barclays notes is not far short of the $20 billion to $25 billion loss range of 2017’s Hurricane Harvey.
However, the losses are being booked at a time of year when budgets typically incorporate much smaller natural catastrophe claims.
It therefore seems likely that re/insurers with exposure to the storm will exceed their Q1 cat budgets, which may be viewed as an ill omen for the year.