{"id":5698,"date":"2025-06-27T15:20:41","date_gmt":"2025-06-27T15:20:41","guid":{"rendered":"http:\/\/studentlearningportal.com\/?p=5698"},"modified":"2025-06-27T16:07:36","modified_gmt":"2025-06-27T16:07:36","slug":"hurricane-erick-insured-losses-expected-to-fall-well-below-otis-am-best","status":"publish","type":"post","link":"http:\/\/studentlearningportal.com\/index.php\/2025\/06\/27\/hurricane-erick-insured-losses-expected-to-fall-well-below-otis-am-best\/","title":{"rendered":"Hurricane Erick insured losses expected to fall \u2018well below\u2019 Otis: AM Best"},"content":{"rendered":"

This content is copyright to www.artemis.bm<\/a> and should not appear anywhere else, or an infringement has occurred.<\/p>\n

Estimated insured losses from Hurricane Erick, which struck Mexico\u2019s Pacific coast last week, are expected to fall well bellow the US$1.97 billion insured losses from 2023\u2019s Hurricane Otis, according to global ratings agency AM Best.
\n<\/span>
\n\"am-best-logo\"In a new report, AM Best notes that losses from Erick are expected to be contained, with parametric insurance contracts unlikely to be triggered.<\/p>\n

However, the agency warns that the current reinsurance market cycle could be further hardened by both Hurricane Erick and the ongoing trend of tropical storms rapidly intensifying into severe hurricanes due to rising ocean temperatures.<\/p>\n

As we had\u00a0reported<\/a>, Erick rapidly intensified into a major hurricane as it approached landfall on Mexico\u2019s Pacific coast, which for a time put the World Bank facilitated $175 million\u00a0IBRD CAR Mexico 2024 (Pacific)<\/a>\u00a0parametric catastrophe bond on-watch.<\/p>\n

As we later explained, the NHC reported that the minimum central pressure of hurricane Erick was 950mb at landfall<\/a>, having risen as it neared the coast, which reduced the risk to the cat bond and left us believing it was unlikely to be affected by the storm.<\/p>\n

We then later reported,<\/a> that catastrophe bond and ILS investment manager Twelve Securis had confirmed that it does is not anticipate any impact to the World Bank catastrophe bond or any of the firm\u2019s private ILS positions due to losses caused by Erick.<\/p>\n

\u201cIn AM Best\u2019s view, estimated insurance industry losses for Hurricane Erick will fall well below the USD 1.97 billion in insured losses from Hurricane Otis in 2023. However, storm damage from Hurricane Erick continues to be assessed as it was the strongest hurricane ever recorded along Mexico\u2019s Pacific coast this early in hurricane season,\u201d AM Best explained.<\/p>\n

The agency noted that for most insurers with exposure in the affected Oaxaca and Guerrero states, the primary impact will likely stem from business interruption losses due to prolonged power outages, flooding, and food shortages.<\/p>\n

\u201cLesser material losses are expected for commercial and residential infrastructure, as well as high-value hotels and resorts. The hurricane had reached Category 4 status before tapering off to a Category 3 storm at landfall,\u201d the agency added.<\/p>\n

\u201cMexico\u2019s insurance industry is strongly capitalized and has sound levels of catastrophic provisions aimed at mitigating the effect,\u201d said Salvador Smith associate director, AM Best.<\/p>\n

Adding: \u201cWe\u2019ll continue to monitor the financial impact of Hurricane Erick on rated companies, as well as credit risk with counterparts and liquidity among rated insurers.\u201d<\/p>\n

Hurricane Erick insured losses expected to fall \u2018well below\u2019 Otis: AM Best<\/a> was published by: www.Artemis.bm<\/a>
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This content is copyright to www.artemis.bm and should not appear anywhere else, or an infringement has occurred. Estimated insured losses from Hurricane Erick,…<\/p>\n","protected":false},"author":1,"featured_media":5700,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[11],"tags":[],"_links":{"self":[{"href":"http:\/\/studentlearningportal.com\/index.php\/wp-json\/wp\/v2\/posts\/5698"}],"collection":[{"href":"http:\/\/studentlearningportal.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/studentlearningportal.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/studentlearningportal.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/studentlearningportal.com\/index.php\/wp-json\/wp\/v2\/comments?post=5698"}],"version-history":[{"count":2,"href":"http:\/\/studentlearningportal.com\/index.php\/wp-json\/wp\/v2\/posts\/5698\/revisions"}],"predecessor-version":[{"id":5701,"href":"http:\/\/studentlearningportal.com\/index.php\/wp-json\/wp\/v2\/posts\/5698\/revisions\/5701"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/studentlearningportal.com\/index.php\/wp-json\/wp\/v2\/media\/5700"}],"wp:attachment":[{"href":"http:\/\/studentlearningportal.com\/index.php\/wp-json\/wp\/v2\/media?parent=5698"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/studentlearningportal.com\/index.php\/wp-json\/wp\/v2\/categories?post=5698"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/studentlearningportal.com\/index.php\/wp-json\/wp\/v2\/tags?post=5698"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}