Copyright © 2024 A.M. Best Company, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

5. "Quiet Record Year" Yields Huge Natural Catastrophe Insurance Losses

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2023 was a "quiet record year" with $93 billion in total insurance losses related to natural catastrophes, despite no major headline storms.

 

6. Syndicated Programs Are a Solution for Non-Peak Peril Insurance Coverage

Customers are adjusting their deductibles and terms and conditions, either willingly or out of necessity, to purchase insurance due to inadequate coverage for non-peak perils.
 

3. Incentivizing Policyholder Risk Mitigation

Primary insurers should take a comprehensive approach to mitigate non-peak peril risk.
 

1. Higher Frequency, Localized Impacts: Understanding Non-Peak Perils

Non-peak or secondary catastrophe perils are characterized by high event frequency and localized occurrences that don't typically cause large single events, unlike peak perils such as hurricanes and earthquakes.
 

2. Neighboritis: The Social Phenomenon Driving Up Insurance Costs

Non-peak peril trends include inflation, exposure growth, suburban sprawl, deferred maintenance, building in the Wildland-Urban Interface, increased precipitation, extreme heat waves, and social phenomena like "neighboritis" and legal system abuse.
Copyright © 2024 A.M. Best Company, Inc. and/or its affiliates. ALL RIGHTS RESERVED.