What’s new: In brief (December 09, 2004)

ING Canada has completed its purchase of Allianz’s Canadian p&c operations, including Allianz Insurance Co. of Canada, Trafalgar Insurance Co. and Canada Brokerlink. Allianz maintains its Allianz Global Risks operation in Canada. ING Canada has planned an offering of its shares to partly fund the $370 million purchase price.

Rating agency A.M. Best says the jury decision this week to declare the felling of the World Trade Center by terrorists on September 11, 2001 as “two occurrences” for insurers representing a minority portion of the policy should not affect the ratings of any of the insurers or reinsurers involved. Despite the US$1.1 billion price tag, with the spread of the payment across the group of nine insurers, their overall financial strength and strong earnings in 2004, the impact will not be significant enough to impact ratings.

Risk modeling firm EQECAT has released the first probabilistic catastrophe model for U.S. winter storms. The firm notes that historical data indicates such storms have accounted for about 8.5% of cat losses in the U.S. in the last half century. “We believe that industry winter storm losses may be understated by as much as a factor or two due to under-reporting. The reason for this is that typically many of the claims come in long after industry sources have tallied losses for the particular storm,” says Lou Estrema, senior vice president of reinsurance broker John P. Woods Co., which collaborated with EQECAT on the creation of the new model.