LLOYD’S of London insurer Catlin yesterday revealed that its New York office remains closed following Hurricane Sandy – and it does not know how much it will have to pay out to those affected by the storm.
The firm said it would be some time before the true cost of the damage is assessed due to the “sheer size of the storm” and “the many different types of claims it has created”.
“Existing catastrophe models are unlikely to predict the quantum of insured damage with a high degree of certainty,” the firm explained.
Although the hurricane took the lives of around 200 people across the Caribbean and the United States, the cost to the insurance industry does not appear to have hit the Lloyd’s market on the same scale as last year’s Japanese tsunami and New Zealand earthquake.
Catlin yesterday announced an 11 per cent rise in gross premiums written to $4.1bn (£2.6bn) for the first nine months of this year. Due to a change in accounting procedures, the increase on a like-for-like basis was eight per cent.
On this basis gross premiums written in the US grew 12 per cent thanks to rate increases and new business, particularly in the energy, casualty and reinsurance classes.
Business written in the UK passed $2bn in the first nine months, up from $1.86bn for the same period in 2011.
Mark Williamson, an analyst at Peel Hunt, said the uncertainty surrounding the bill for North American storm damage had caused him to lower the stock’s rating from “buy” to “hold”.
“The prospects of earnings upgrades now appear much diminished following superstorm Sandy, and Catlin is unlikely to return capital beyond its ordinary dividend,” he explained.