Guidance on Japanese Earthquake and Tsunami (3703E)
06 Abril 2011 - 3:00AM
UK Regulatory
TIDMHDU
RNS Number : 3703E
Hardy Underwriting Bermuda Ld
06 April 2011
Date: 6 April 2011
On Behalf of: Hardy Underwriting Bermuda Limited ('Hardy')
Embargoed for: 0700hrs
Hardy Underwriting Bermuda Limited
Guidance on Japanese Earthquake and Tsunami
The Board of Hardy Underwriting Bermuda Limited (LSE: HDU), the
specialist insurer and reinsurer, provides the following guidance
about the potential impact of the Japanese earthquake and
tsunami.
Most importantly, Hardy's sympathy is with all those who have
been affected by the tragic events in Japan. Hardy remains a strong
supporter of the Japanese reinsurance market and has established
important relationships there over a number of years.
It will take several months before estimates of the industry
losses from the earthquake and tsunami can be accurately
calculated. There are, nevertheless, a number of factors to be
borne in mind in assessing potential losses, as follows:
-- disaster scenarios have normally been based on an event
centred on Tokyo; the insured losses from the more rural areas that
have been most affected should be significantly less;
-- Hardy is a lead reinsurer in Japan, but has tended to
position itself on the higher layers of programmes;
-- Hardy has purchased second event reinsurance protection at a
relatively low attachment point for 2011 and also has substantial
quota share cover, so the reinsurance programme going forward
provides greater protection than was available in 2010;
-- the Kyosai book of insurance written by Hardy includes
homeowners' business, but only provides contents cover and does not
include earthquake shock or tsunami; the impact of "fire following
quake" on the book is not expected to be material;
-- Hardy's marine and aviation accounts are unlikely to have any
material losses, and the specialty lines division does not have
significant exposure to personal accident cover in the affected
areas; and
-- the direct and facultative (D&F) property account has low
exposure to the affected region and losses are not expected to be
significant; a conservative reserve has, however, been included in
the total loss estimate.
Hardy has assessed the loss from its property treaty portfolio
on a ground up contract by contract basis, using damage factors by
prefecture, predicated on an industry loss of approximately
GBP21.5bn (US$35bn). On this basis the best estimate of the total
net loss to Hardy from this event is between GBP9m and GBP12m.
The cumulative effect of the catastrophe events in 2010 and 2011
has had a positive impact on the rating environment generally, and
most notably for risks with international catastrophe exposure.
David Mann, Chairman of Hardy, said:
"Our thoughts are with those who are suffering as a result of
recent catastrophes, and I intend to join the Hardy underwriting
team visiting Japan in June in order to gain a more complete
understanding of the position and to demonstrate our commitment to
this important market. The world certainly seems to be a riskier
place at the moment, and this creates both opportunities and
threats to our industry."
-ends-
Enquiries:
Hardy Underwriting Bermuda Limited www.hardygroup.co.uk
Barbara Merry, Chief Executive Tel: (020) 7626 0382
Jamie MacDiarmid, Finance Director
Peel Hunt
James Britton / Guy Wiehahn Tel: 020 7418 8817
Redleaf Communications hardy@redleafpr.com
Emma Kane/Alicia Jennings Tel: 020 7566 6741
Notes to Editors:
-- Hardy is a specialist underwriting business operating within
Lloyd's of London.
-- Hardy has consistently out-performed the Lloyd's market since
1975 over a number of underwriting cycles. It underwrites across
most of the major classes of commercial insurance and reinsurance
business except motor.
-- Further information on Hardy is available at the Group's
website: http://www.Hardygroup.bm/
This information is provided by RNS
The company news service from the London Stock Exchange
END
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