Insurance industry weathers Gustav

Insured losses from Hurricane Gustav were not large enough to affect the creditworthiness of the insurance and reinsurance industries, Standard & Poor’s Ratings Services announced today. Insured property losses from the storm are estimated at $3 billion to $6 billion, while offshore losses, which include oil platforms and wells, are estimated at $1 billion to $4 billion. However, the New York-based ratings agency noted that Gustav was just the latest — albeit the most severe — in a year of “unusually high frequency of modest-sized catastrophes and large individual commercial claims.” As a result, it’s possible that further losses from smaller catastrophes or a substantial loss from one of the current developing tropical storms “could have a more material adverse effect on ratings,” the agency said. If this happens, the agency said, the effects would be more pronounced on primary companies and less on reinsurers than was the case in 2005 when Hurricanes Katrina, Rita and Wilma struck.