“Despite the advance warnings, many reinsurers and brokers expect the jaws of some primary company executives to drop at that revelation,” Mr. Wilt wrote in a research note.

Further shock will follow the realization that the cost of reinsurance has accelerated by between 30 percent and 50 percent since Jan. 1. “Talk about a one-two punch,” he wrote.

The updated RMS U.S. Hurricane model provides a new view of hurricane frequency in the Atlantic Basin that explicitly represents risk based on a “medium-term” (five-year) forward-looking view.

Dr. Robert Muir-Wood, chief research officer at RMS, said the hurricanes of 2004 and 2005 have also provided new insights into the amplification of insured losses in severe catastrophes due to economic causes beyond wind and water damage.

“Hurricane Katrina has prompted further research and understanding on how one high-impact event can create a cascade of far more damaging consequences. A whole new tier of economic, behavioral and systems-based modeling is required to predict the losses in such super catastrophes,” he said.

In his research note, Mr. Wilt stated that the dislocation in the reinsurance market has now moved beyond coastal exposures along the Atlantic to impact the cost of earthquake covers in California “that have also begun to rise meaningfully–up some 50 percent or more on year-on-year renewals.”

In general, he said, national accounts soak up much reinsurance capacity. “We suppose Allstate's $2 billion purchase earlier this year and recent efforts by State Farm to secure additional catastrophe reinsurance are having a big impact on available capacity,” he wrote.

Personal insurers have had some success in passing reinsurance costs on to policyholders. “This is not to suggest that rates in cat-exposed areas are adequate, but regulators seem receptive to the need for personal insurers to pass along reinsurance costs,” Mr. Wilt said.