This is not to say 2010 was not without interest. But the big stories were more in specific markets or about individual companies than any industry-wide shocks to the system.
If the measure of a good year is one in which firms were reasonably profitable, then 2010 should be seen as pretty good. Profits rolled in. A few events struck, but nothing that cost the market more than $10bn.
But if the measure is the market finishing the year in better shape than it started it, then 2010 could go down as a shocker. Profits and returns on equity are likely to turn out much below 2009's strong performance. It is not yet clear whether it is seen as the start of a terrible run for the market, as 1997 was, or the start of an improvement.
|The most costly insured catastrophe losses in 2010|
|Ranking||Insured losses (in $m)||Date (start)||Event||Country|
|1||8,000||27-Feb-10||Earthquake (M8.8) triggers tsunami||Chile|
|2||2,854||27-Feb-10||Winter storm Xynthia||France/Germany/Spain et al|
|3||2,677||4-Sep-10||Earthquake (M7.0)||New Zealand|
|4||2,000||5-May-10||Storms with winds up to 120km.h, hail||US|
|5||1,580||20-Apr-10||Storms with winds up to 130km.h, hail||US|
|6||1,023||13-Mar-10||Storms, hail, rain, floods||Australia|
|7||1,014||22-Mar-10||Storms, winds up to to 120 km.h, hail, rain, mudslides||Australia|
|8||1,000||20-Apr-10||Explosion on Deepwater Horizon||Gulf of Mexico, US|
|US natural catastrophe figures: with the permission of Property Claims Services (PCS)|
|Source: Swiss Re|
There have been some notable disasters. The extent of the claims challenges from February's earthquake in Chile threw up surprises for insurers and reinsurers. Wind storm Xynthia tested the European market. The Deepwater Horizon oil spill in April turned the energy market on its head, with the long-term effect of the disaster still unclear. And a September earthquake in New Zealand followed earlier cat losses in Australia, capping a miserable year for Australasia's catastrophe market.
It has also been a busy year on the regulatory front. The industry in the US held its breath while financial reform was worked out. In the end, the Dodd-Frank Act was not as bad for insurers as some feared. However, the market still needs to be aware of the potential dangers emerging from the implementation of the act. In Europe, the unrelenting March towards Solvency II continued. This year saw the start of the fifth quantitative impact study as well as much hand wringing over the final details of the new solvency directive and non-EU country's equivalency with it.
Undoubtedly the biggest challenge for the market, however, is the pricing environment, with insurers and reinsurers mired in a soft market in almost all insurance classes but holding more capital than they know what to do with. This has led to a frenzy of share buybacks. Some firms are also looking to bulk up. There may soon be more acquisitions such as 2010's merger of Max Capital and Harbor Point, which formed Alterra.
In the run-up to the new year, Reactions is counting down our pick of the 10 biggest stories in 2010. Revisist this page each day to for updates. Click on the headlines to read.
10. New Zealand earthquake
9. Share buybacks
8. Winter storm Xynthia
7. The rush to re-domicile
6. Solvency II's unrelenting march
5. AIA/Pru deal collapses
4. The Dodd-Frank Act
3. Contingent commissions all round
2. Chile earthquake
1. Deepwater Horizon