Increased capacity proposed for the Florida Hurricane Catastrophe Fund cannot be expected to have much impact on reinsurance pricing, according to a banking firm's analysis.
Bank of America Securities reinsurance analyst Tamara Kravec said the current proposed addition of $14 billion to the FHCF could lead to some reductions for accounts that saw some of the most spectacular increases in 2006.
"Some volume written by the private market in 2005 may go into the cat fund, but we expect even with these changes, most reinsurers will be able to write as much business as they like," Ms. Kravec wrote.
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