HDU Hardy Under. Bm

TIDMHDU

RNS Number : 3703E

Hardy Underwriting Bermuda Ld

06 April 2011

 
 Date:            6 April 2011 
 On Behalf of:    Hardy Underwriting Bermuda Limited ('Hardy') 
 Embargoed for:   0700hrs 
 

Hardy Underwriting Bermuda Limited

Guidance on Japanese Earthquake and Tsunami

The Board of Hardy Underwriting Bermuda Limited (LSE: HDU), the specialist insurer and reinsurer, provides the following guidance about the potential impact of the Japanese earthquake and tsunami.

Most importantly, Hardy's sympathy is with all those who have been affected by the tragic events in Japan. Hardy remains a strong supporter of the Japanese reinsurance market and has established important relationships there over a number of years.

It will take several months before estimates of the industry losses from the earthquake and tsunami can be accurately calculated. There are, nevertheless, a number of factors to be borne in mind in assessing potential losses, as follows:

-- disaster scenarios have normally been based on an event centred on Tokyo; the insured losses from the more rural areas that have been most affected should be significantly less;

-- Hardy is a lead reinsurer in Japan, but has tended to position itself on the higher layers of programmes;

-- Hardy has purchased second event reinsurance protection at a relatively low attachment point for 2011 and also has substantial quota share cover, so the reinsurance programme going forward provides greater protection than was available in 2010;

-- the Kyosai book of insurance written by Hardy includes homeowners' business, but only provides contents cover and does not include earthquake shock or tsunami; the impact of "fire following quake" on the book is not expected to be material;

-- Hardy's marine and aviation accounts are unlikely to have any material losses, and the specialty lines division does not have significant exposure to personal accident cover in the affected areas; and

-- the direct and facultative (D&F) property account has low exposure to the affected region and losses are not expected to be significant; a conservative reserve has, however, been included in the total loss estimate.

Hardy has assessed the loss from its property treaty portfolio on a ground up contract by contract basis, using damage factors by prefecture, predicated on an industry loss of approximately GBP21.5bn (US$35bn). On this basis the best estimate of the total net loss to Hardy from this event is between GBP9m and GBP12m.

The cumulative effect of the catastrophe events in 2010 and 2011 has had a positive impact on the rating environment generally, and most notably for risks with international catastrophe exposure.

David Mann, Chairman of Hardy, said:

"Our thoughts are with those who are suffering as a result of recent catastrophes, and I intend to join the Hardy underwriting team visiting Japan in June in order to gain a more complete understanding of the position and to demonstrate our commitment to this important market. The world certainly seems to be a riskier place at the moment, and this creates both opportunities and threats to our industry."

-ends-

Enquiries:

 
 Hardy Underwriting Bermuda Limited   www.hardygroup.co.uk 
 Barbara Merry, Chief Executive       Tel: (020) 7626 0382 
 Jamie MacDiarmid, Finance Director 
 
 Peel Hunt 
 James Britton / Guy Wiehahn          Tel: 020 7418 8817 
 
 Redleaf Communications               hardy@redleafpr.com 
 Emma Kane/Alicia Jennings            Tel: 020 7566 6741 
 

Notes to Editors:

-- Hardy is a specialist underwriting business operating within Lloyd's of London.

-- Hardy has consistently out-performed the Lloyd's market since 1975 over a number of underwriting cycles. It underwrites across most of the major classes of commercial insurance and reinsurance business except motor.

-- Further information on Hardy is available at the Group's website: http://www.Hardygroup.bm/

This information is provided by RNS

The company news service from the London Stock Exchange

END

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