PROPERTY owners in the Caribbean can breathe a sigh of relief as last year’s catastrophes are not expected to cause insurance premiums to surge.

Reinsurance brokers say despite the fact 2011 was the most expensive year ever for natural disasters, the back-toback series of catastrophes did not drive coverage prices higher across the Bermuda industry or other key players in the global market when policies were renewed on January 1.

Reinsurers’ strong capital base meant only insurance policies covering nations the most affected by catastrophes, such as Japan, Thailand and New Zealand, faced significant increases, James Vickers of Willis Group Holdings Plc stated.

Rates in many other lines of business “have hardly moved at all”, even as reinsurance companies lost money on their underwriting, Vickers, chairman of Willis Re’s international and specialty reinsurance unit is reported to have said.

Last year was the priciest 12 months of natural disasters on record for reinsurers and the primary insurers whose risks they help bear, Munich Re, the world’s biggest reinsurer, said last week Wednesday. Earthquakes in Japan and New Zealand and Australian and Thai floods helped cost the industry about US$105 billion, surpassing the previous catastrophe record of US$101 billion in 2005, when reinsurers were forced to raise capital in the wake of Hurricane Katrina.

Reinsurers covered about half of those insured losses, according to Willis, the world’s third-biggest reinsurance broker.

Vickers estimated that the industry’s capital at the end of the third quarter was at the same level as the start of 2011, meaning more reinsurers were healthy enough to compete for business on price.

In a January 3 conference call hosted by Keefe Bruyette & Woods Ltd, David Watson, head of XL Group Plc’s European division, admitted that reinsurers hoping to charge more were disappointed when renewal time rolled around.

About two-thirds of propertyand-casualty reinsurance contracts are typically up for renewal in January. The remainder are renewed in April and July, with a focus on the Asia-Pacific region and the US.

Brian Boornazian, head of reinsurance at Bermuda-based Aspen Insurance Holding Ltd, is on record as having said during another conference call that same day hosted by Evercore Partners Inc that only catastrophe-exposed contracts and contracts affected by losses saw significant improvements in rates.