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Donk107 said..shaggybaxter said..
Ouch. Firesale auction coming on a bunch of battered and bruised hulls, and a few cat companies will be getting a rash of new orders in the fall methinks.
Wonder what insurance premiums are like in BVI?
A person i know in the building industry was told that the insurance companies that you and i insurance with have insurance policies with other larger companies and when a natural disaster happens where there is going to be lots of claims made against with them they will then claim on their insurance
If this is the case i wonder if our insurance premiums here will increase if insurance companies over their have to pay out lots of money and the larger company they re-insure with decide they need to recoup some of the money they have paid out
Not sure that i have made myself clear but hopefully i have
I think this is what i am talking about
agents.insurancequotes.com/general/reinsurance-who-insures-the-insurance-companiesRegards Don
All insurers use reinsurance to spread the risk. Reinsurance companies are global so as they pay out anywhere they spread the costs over their global market. So yes, our premiums are affected by such incidents.
I worked in reinsurance and insurance as a management consultant. One thing I took out of that experience is that less than 20% of a insurance premium goes to underwrite the risk. The rest goes into peoples pockets in commissions and bonuses. So if you insure a boat for $65,000 for a $1,000 premium $200 is actually underwriting the risk. That is, the chance the insurer places on you claiming a full loss is 325/1. By putting an excess on smaller claims, having no claims bonuses they can cancel and that they can increase your premiums if you make a claim, they encourage you to not make smaller claims.
This convinced me to only insure those risks that would have a major life impact. If I can afford to lose it I don't insure it as the cost is far far in excess of the risk/probability of using it.