“Reinsurance Implications of the Japanese Earthquake”
The March 11, 2011 earthquake and resulting tsunami that produced widespread devastation throughout parts of Japan is likely to produce significant claims in the worldwide reinsurance market. The most recent estimates predict that total economic losses will likely exceed $300 billion, and total reinsured losses could exceed $35 billion. Given the breadth of the devastation, and the magnitude of the expected losses, it is critical that insurers and reinsurers carefully analyze their reinsurance agreements to determine (1) whether existing reinsurance agreements may be impacted by the expected losses, and (2) if so, the manner in which that reinsurance should respond.
This Stroock Special Bulletin highlights the primary coverages that may potentially respond to losses arising out of the Japanese earthquake and tsunami, as well as reinsurance issues that might arise once claims are presented.