HAMILTON, Bermuda, Sept. 12 /PRNewswire/ -- The global reinsurance market plays an integral role in spreading US hurricane risk around the world. Without it, the risk would be concentrated in a single state (or geographic region) or in the US with the result being higher insurance costs for US consumers. The reinsurers of US hurricane risk are predominantly located outside of the United States with a very large number located in Bermuda. Many of these reinsurers are members of the Association of Bermuda Insurers and Reinsurers (ABIR). Below you will find some background information that may be useful to you in analyzing the impact of the hurricane on insurance markets.

    ABIR president Brad Kading noted today:
    1. Bermuda's insurers and reinsurers understand property catastrophes
       including hurricanes.  We understand the tragedy they create for
       families who lose loved ones or lose their homes.  Hurricane Ike has
       the potential to cause a tremendous loss of life.  ABIR member
       employees themselves are exposed to hurricane risk in Bermuda and they
       are familiar with what families and businesses need to do to protect
       themselves against these storms and to recover from those losses.  We
       offer our heartfelt sympathy to those affected so severely by Hurricane
       Ike in Texas and in the Caribbean prior to the US landfall.
    2. Bermuda's insurers provide an estimated 66% of the reinsurance
       purchased by the Texas Windstorm Insurance Association (TWIA).  The
       TWIA protects the property most exposed to hurricane damage in Texas.
       It is entirely possible that TWIA will collect on the entire amount of
       its approximate $1.5 billion in hurricane reinsurance coverage.  If so
       Bermuda's carriers will pay approximately $1 billion of the TWIA
       reinsurance recovery.  This will directly aid Texas taxpayers because
       without this reinsurance there would be a bigger hit to the state
       treasury based on the current TWIA assessment framework.
    3. Based on an analysis of reinsurance premium from insurers most exposed
       to hurricane risk in Texas, Bermuda's insurers will provide an
       estimated 45% of the reinsurance claims that will eventually be paid to
       insurers for damage caused by Hurricane Ike.  It is impossible to
       accurately forecast the total insured losses for Ike at this time.  All
       loss estimates at this time are purely hypothetical.  However, the more
       severe Ike's damage is, the more likely it will be that reinsurers pay
       a larger share of the actual insured hurricane damage.