Munich Re says damage inflation well above CPI rate

FRANKFURT (Reuters) – Munich Re said on Sunday that it will push for higher reinsurance rates to take into account the fact that costs for insured damages are rising much faster than overall consumer prices.

“Damage inflation is significantly higher (than overall inflation) in many reinsurance segments,” management board member Thomas Blunck said in a statement on the ‘Rendez-Vous de Septembre’ industry meeting in Monte Carlo.

He cited higher U.S. legal claims for damages, costly new medical treatments as well as shortages in construction materials and qualified workers, among other factors driving inflation of insured damages.

“Munich Re will continue to be mindful of adequate reinsurance rates and contract terms,” management board member Thomas Blunck said in the statement.