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Power market not hardening despite high losses

03 August 2010

Insurance rates in the power sector are expected to soften further in 2010, despite conditions that would normally foreshadow a hardening market, according to the latest Power Market Review from Willis, a member of Willis Group, the global insurance broker.

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Insurance rates in the power sector are expected to soften further in 2010, despite conditions that would normally foreshadow a hardening market, according to the latest Power Market Review from Willis, a member of Willis Group, the global insurance broker.

In contrast with the widespread perception that property underwriters had a good year in 2009, mainly as a result of an abnormally low level of insured natural catastrophe losses, the continuing level of generator failure claims meant that some power insurers may have failed to turn an underwriting profit in 2009.

Despite this loss trend, the Willis review said a hard market failed to materialise in 2009 – as some predicted – and soft market conditions persisted through the first half of 2010. 


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If last year was the year of the cat, then this year could be the year of the debt crisis.

Mike Van Slooten, head of international market analysis at Aon Benfield