MBA: Catastrophic Insurance Coverage Forever Changed by Katrina

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Catastrophic insurance pricing for commercial real estate may never return to pre-Hurricane Katrina levels due to the increased loss expectations from hurricanes and rating agency scrutiny over an insurance company's overall exposure to catastrophic events. That was the major conclusion of a white paper commissioned by MBA.

The MBA white paper, Natural Disaster Catastrophic Insurance-The Commercial Real Estate Finance Perspective, noted that in 2004 and 2005, natural disasters caused $89 billion in privately insured catastrophic losses, prompting insurance companies to re-examine their business models for insuring natural disasters.

The overall purpose of the MBA white …