Weather

The modelling firm said its study aimed to help insurers “plan for the worst and hope for the best”.

Markdowns have wiped more than $220mn off the value of $1.6bn of aggregate cat bonds benefitting major US insurers after the Texas Big Freeze.

Policyholders have filed some 730 claims after fires hit hills outside the western city.

The modeller said it is “likely” that the number of claims could exceed the high of Hurricane Harvey in 2017.

A weakening La Nina and warm sea temperatures in the tropics raise the specter of elevated catastrophes for the rest of the year.

Some pointed to low average costs to fix burst pipe claims, while others warned that BI could drive up losses.

Aggregate cat bonds and quota shares may be exposed although the loss would typically be expected to skew to the traditional binders and insurance market.

The ratings agency says it will continue to monitor whether the cat event could affect the rating outlook for any entity.

The veteran risk modeller says claims will be driven by the combination of anomalous temperatures that are well below average in a region unprepared for such a sudden freeze.

The nature of the event means that more losses may take time to emerge.

In a note to clients seen by this publication, the risk modelling firm says the event may break records for insured winter storm losses.

The carrier also expects to report $23.4mn of reserve strengthening in its results on 25 February.