One analyst says catastrophe claims in El Nino periods are broadly on par with that of neutral weather patterns, and 42 per cent lower than in La Nina.
But the climate has now shifted to an El Niño weather pattern.Combined with big premium rises earlier in the year, it is expected to boost profitability.
“But bushfires account for only 11 per cent of total Australian-insured catastrophe claims since 1968 while cyclone, storm and flooding account for 59 per cent.” Motor insurance, meanwhile, also benefited from the warmer conditions because the roads were drier, according to the Morgan Stanley analyst.
Mr Guse said bushfires typically affected a smaller number of policyholders because they occurred in less densely populated areas, whereas floods and storms could take hold in more built-up areas such as cities.“You find that, with bushfires, you have damage and there are total loss of houses, but it’s a small number. Where if you have a cyclone you can have 200 homes ripped apart in one go, and it’s the same with floods,” he said.
in response to higher costs. QBE and Suncorp followed suit with increases of about 12 per cent each on their home cover.
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