MEXICO CITY–(BUSINESS WIRE)–Although severe damage to infrastructure and housing is expected across most of Central America from Hurricane Eta, AM Best expects insured losses to be minimal.
In its Best’s Commentary, “Minimal Insurance Losses Expected from Hurricane Eta,” AM Best notes that historic poverty levels and limited resources—already exacerbated by the COVID-19 pandemic—characterize most of the regions along Hurricane Eta’s trajectory, compounded by very low to nonexistent insurance coverage. Hurricane Eta made landfall as a Category 4 storm in northern Nicaragua, and is likely to impact much of Central America and southern Mexico.
Although it is still too early to gauge overall insured losses, AM Best expects net losses after reinsurance to have a minimal impact on the insurance companies’ bottom line, given that catastrophe risk retention remains at conservative levels. In addition, lower claims frequency due to the pandemic and quarantine could help insurers overcome further shocks and deviations stemming from the hurricane and maintain consistent profitability.
To access the full copy of this commentary, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=302719.
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in New York, London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.
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