Standard & Poor reports that insured crop losses caused by the worst drought since 1988 could cost insurers and reinsurers more than $5 billion.
The rating service says crop insurers “will see some of the worst underwriting results on their books” in 24 years, but the losses will be manageable because of “loss sharing from the U.S. government and diversification with other lines of business.”
This updated loss projection is nearly double the $2.8 billion estimate Milliman released just weeks earlier. In the Milliman report, the trade group representing the crop-insurance industry stated insurers had already paid out $822 million by early August. The group explained that high losses were due to prolonged drought conditions in the Midwest and underwriting losses for 12 major corn- and soybean-producing states.
Recommended For You
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© Touchpoint Markets, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more inforrmation visit Asset & Logo Licensing.
