In the fall of 1998 I started a job in New York with one of the world’s largest reinsurers. Soon after, at a meeting in a conference room above Park Avenue, someone complained that the market for reinsurance had gone soft. “What we need,” he said, “is a good catastrophe.” It was a joke, but true, too. I offered that a cyclone had hit Bangladesh and it had been an active year for cyclonic storms. No, he explained, little of that value was insured. “Honestly,” said someone else, “I’ve never understood why those people don’t just leave. It’s a dangerous place.” By definition, reinsurers work at the edge of suffering, and so have developed euphemisms to help them stand at a distance. A catastrophe is called a “loss event.” A catastrophe big enough to affect several reinsurers is called an “industry loss event.” #Sept11

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