Patrick Mailloux, president and CEO, Swiss Re America Corp., said there is a greater existing catastrophic exposure than was originally believed by many. "Reinsurance programs may need to be re-thought, which is likely to lead to an overall increased demand for reinsurance." He said the unprecedented hurricane season with hurricanes Katrina, Rita, and Wilma caused insured losses of more than $60 billion.

"Security continues to be a concern and flight to quality is anticipated to favor large and diversified players in the long run." He said that the magnitude of losses has changed the landscape adding a new perception of risk and of how much capital is needed. "They [the hurricanes] were very expensive reminders."

Oil prices will be the hot button economic issue in the coming year, Kurt Karl, head, economic research & consulting, North America, said. "The economy has weathered the storm of post-Katrina uncertainty and is on track for a trend growth year in 2006. With the market providing low investment yields, insurers will need to maintain underwriting discipline to sustain profits."