1. Regional Reinsurance Pooling: experiences in The Americas ICP 13: Reinsurance and Other Forms of Risk Transfer. Mike Kreidler Washington State Insurance Commissioner

2. Catastrophe Related NAIC Working Groups Catastrophe Working Group – Consumer Outreach and Assistance Post-Disaster Subgroup – Post-Catastrophe Regulatory Guidance Subgroup Catastrophe Response Working Group – Seek to improve disaster response and preparedness and consumer awareness. – NAIC members also educate Congress and provide technical feedback and legislation

3. Coordinated Disaster Reporting Initiatives  Enhance the regulatory process  Sharing resources  Reduces duplicative requests to insurers  Provides key data for solvency and market conduct responsibilities  Assists interested parties, insurers and other regulators

4. The Economic Cost of Catastrophes  Average Annual U.S. Insured Catastrophe Losses are over $20 billion  These costs have a huge impact on U.S. economy  Cost steadily growing  Rising likelihood of catastrophic weather events

5. THE TEN MOST COSTLY CATASTROPHES, UNITED STATES RankDatePeril Dollars when loss occurred ($ millions) 2012 Dollars ($ millions) 1August 2005Hurricane Katrina$41,100 $47,424 2September 2001Fire, explosion, World Trade Center, Pentagon Terrorist Attacks $18,779 $ 23,883 3August 1992Hurricane Andrew$15,500 $23,349 4October 2012Hurricane (Superstorm) Sandy$18,750 5January 1994Northridge, CA earthquake$12,500 $18,043 6September 2008Hurricane Ike$12,500 $13,283 7October 2005Hurricane Wilma$10,300 $11,885 8August 2004Hurricane Charley$ 7.475 $ 8,912 9September 2004Hurricane Ivan$ 7,110 $ 8,476 10April 2011Flooding, hail and wind including the tornadoes that struck Tuscaloosa and other locations $ 7,300 $ 7,431 Source: Property Claim Services (PCS), a division of Verisk Analytics.

6. Value of Insured US Coastal Exposure See, http://www.air-worldwide.com/In-the-News/US-coastal-exposure-rises-with-sea-levels/http://www.air-worldwide.com/In-the-News/US-coastal-exposure-rises-with-sea-levels/

7. Financing Disaster Risks through Private Insurance Private Markets – Through insurance and reinsurance – State regulators ensure efficient, competitive markets – Regulate solvency and market conduct

8. Financing Disaster Risks Through Government Programs  Flood  Earthquake  Crop  Residual Market Mechanisms  Terrorism

9. Reinsurers Some high-value risks for catastrophes or terrorism risk have limited availability for reinsurance protection National and regional reinsurance pools have evolved.

10. Reinsurance Pools A.M. Best defines a reinsurance pool as “any entity, agent or contractual agreement that provides a mechanism for collective acceptance and sharing, equal or otherwise, of insurance risk among its members.”

11. U.S. Regulatory Requirements Property and Casualty Model Rating Law – Provides authority for the establishment of both voluntary and involuntary property and casualty underwriting and reinsurance pools See - http://www.naic.org/prod_serv_model_laws.htmhttp://www.naic.org/prod_serv_model_laws.htm NAIC maintains a numerical listing of all pools and associations in the Listing of Companies for purposes of Annual Statement Reporting. NAIC White Paper “Regulation of Voluntary Underwriting and Reinsurance Pools.” See - http://www.naic.org/prod_serv_publications.htm#voluntary_underwri te http://www.naic.org/prod_serv_publications.htm#voluntary_underwri te