SWISS RE EYES SECONDARY PERILS REPRICING IN WAKE OF FLOOD LOSSES

Rising losses from secondary perils could prompt rate rises in the third quarter, Swiss Re executives said. The reinsurance giant said following July's European floods and civil unrest in South Africa, which could be a “combined mid-triple-digit-million US dollar” loss, it will look to adapt to pricing to the rising frequency and severity of secondary events. “The consensus is we’re going to have much drier weather in the south, so droughts will be a problem, and in the north there will be more rainfall, more humid weather, so flooding will be the more important risk [in the third quarter],” Christian Mumenthaler, Swiss Re’s group chief executive, said. “This is not a surprise, but every year we have to adapt our pricing.” Mumenthaler said the July losses have not reached the limit of Swiss Re’s natural catastrophe budget, but “we will see how the patterns evolve” in the two months to come. The comments came as Swiss Re swung to more than $1bn profit in the first half of the year as property/casualty (P&C) profits surged amid diminishing Covid-19-related impacts.