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CATASTROPHE RISK PROJECT
PAPERS
This page provides access to literature and
materials related to the Catastrophe Risk Project.
PAPERS:
The intense hurricane seasons of 2004 and 2005
caused substantial instability in property insurance markets in
coastal states with the greatest pressure in Florida and the southeast.
While no severe hurricanes have struck the US since 2005, market
pressures remain high given the substantial risk still facing
coastal states. The market developments in high-risk areas have
generated considerable concern and some controversy among various
groups of stakeholders. As both insurers and property owners seek
to adjust and respond to changing circumstances, public officials
are wrestling with how to deal with market changes and looking
for remedies that will ease the pressures on consumers. In this
context, it is important to understand how property insurance
markets have been changing and analyze the forces driving their
dynamics. This paper presents an updated analysis of property
insurance market conditions and developments with a particular
focus on Florida and five other states – Texas, Louisiana,
Mississippi, South Carolina and New York. These states represent
an array of market conditions with the greatest risk and market
pressure in Florida followed by Louisiana and Texas. Our analysis
documents the significant restructuring of these markets, the
rising price of and tighter availability of insurance, and the
substantial losses suffered by insurers that have adversely affected
the
supply of coverage. We also consider how insurance markets will
continue to evolve under different risk and regulatory scenarios.
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