Flagstone: Australia Disaster Estimates
Flagstone Reinsurance Holdings, S.A. — which has a significant Bermuda presence – today [Feb. 28] announced that its preliminary estimate from loss events that have occurred in Australia in the first quarter of 2011 is expected to be between $60 to $80 million, net of reinstatement premiums and retrocession.
These events — estimated to be the costliest disasters in that country’s history – include, large-scale flooding in Queensland and Victoria in January, 2011 [pictured], and Tropical Cyclone Yasi, a powerful Category 4 storm, which caused serious damage when it mauled large parts of Northern Queensland on February 3, 2011.
Additionally, on February 22, 2011, a powerful 6.3 magnitude earthquake struck Christchurch, New Zealand, causing widespread damage and business interruption. This event is expected to cause sizeable losses to the insurance industry.
Flagstone — which recently redomiciled in Luxembourg — was founded in Bermuda in 2005 and still maitains executive offices and underwriting operations here.
“The company has commenced the estimation process for expected claims relating to its exposures from these events but believes it’s too early to issue an estimate of claims given the significant unknowns and early stages of the claims reporting process,” said Flagstone. “The company is protected by multiple layers of reinsurance which could be triggered should this loss prove to be significant.”
Flagstone’s loss estimates are based on its proprietary modelling analysis, the assessment of individual treaties and client data, and third-party vendor models. These estimates may be further refined as additional information is received from cedants and there exists the risk for further revisions.
