Atlas Magazine January 2009

2008, a year to forget

2008 has been quite a busy year. Many events have occurred in succession straining insurers and reinsurers who were not spared.

It all began with the skyrocketing oil prices which triggered the first economic slowdown and cuts in household expenses resulting in a decline of the insurance premiums' collection.

With that of 2005, the cyclonic season of 2008 which shook the Gulf of Mexico, has been one of the most devastating one for reinsurers. Moreover, rainfall and earthquake occurrences in China have caused considerable losses in human lives and material damages amounting to hundreds of billions of dollars.

While insurers and reinsurers were counting the losses due to natural disasters, the last quarter financial crisis came to deal the final blow to a business on the brink of nervous breakdown. The collapse of the financial stock markets has plunged the market into depression.

All stakeholders are awaiting a difficult 2009. Job cuts and the closure of industrial and commercial sites will undoubtedly have an impact on both household and entrepreneurial risks. Insurance classes of business such as life, credit, health, engineering and construction will suffer a slowdown.

Even those countries which reaped billions of dollars out of the recent oil price increases are on high wire. Pharaonic projects and soft dreams are over. Return to reality is brutal.

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