Calling all HedgeAnons
I have said for a while that if you want to look at a way to profit from Property & Casualty catastrophe losses, (oh, I dunno, like wildfire large losses,) then you should look at short positions on the reinsurance market. It is probably worth a dig. Unknown if Valdus is worth looking into, but may be notable given the article reference.
PNC insurers take out insurance via the reinsurance market. So cat loss indemnity over certain amounts ($40M? or something like that) get picked up by reinsurers. Francis/Charlie/Jean/Ivan threw insurers for a loop, as most only purchased reinsurance to cover one large hurricane event a year. Spooked a lot of companies which doubled down, especially after Katrina/Wilma/Rita the following year. With record back to back catastrophe years over the last five years or so, it's almost like one were controlling the weather to wreak havoc on the American financial system.
Hmmm…
https://www.reinsurancene.ws/aigs-aggregate-reinsurance-at-risk-on-up-to-800m-q4-cat-loss/
https://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=25754038
Remember why AIG got bailed out?
>Insurance exposure.
http://fortune.com/2010/09/02/why-the-fed-saved-aig-and-not-lehman/