Only 40 percent of insurance industry professionals believe that all insurers and reinsurers will be able to rely on accurate catastrophe models–whatever the weather, according to a conference survey.
That was the finding after a poll of participants at Aon's 9th annual Latin American Energy Insurance Conference in Cancun, Mexico.
The survey sought responses from close to 240 attendees, consisting of brokers, energy insurance buyers, and insurers from Latin America and other regions.
The executives, gathered by the Chicago-based insurance broker, gathered to exchange ideas and discuss market implications of the 2005 hurricane season.
"Risk management is more than policy buying," said Magne Seljeflot, chairman, Aon Natural Resources Global Practice Group. "It's our job as risk consultants to educate clients. This year, after the 2005 hurricanes, the intricacies of energy risk are greater than ever. We're working with clients to help them better understand the risks."
Other findings from the survey:
o Most believe that insurers for energy companies in Latin America should benefit this year from the increased appetite for international business,
oDespite controversy over contingent business interruption coverage (interruption cause by failure of a supplier) that has come to light since the 2005 hurricane season, only 42 percent of insurers believe the coverage for energy risks cannot be underwritten successfully in the long term, and should be excluded.
o Sixty-seven percent of those surveyed indicated they believe that the energy insurance market will respond to today's underwriting challenges and price its cover for U.S. windstorm effectively in the future.
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