Catastrophe modeling firms and rating agencies all are retooling their models, and many are worried what the new views of catastrophe risk from these concerns will mean for the industry, he said, positioning his estimate as one answer to the question.

Running an industry database through RMS' new hurricane model, Mr. Nakada said the increase from the old model for a 1-in-250-year loss for hurricane risk was $55 billion. Assuming that companies might choose to hold 150 percent of their 1-in-250 results to garner strong ratings, he produced the $82 billion potential increase in required capital for the industry (multiplying the $55 billion by 1.5).

While he noted that Standard & Poor's new rating criteria rely on one-in-250-year aggregate net losses, and that companies usually target some higher percentage of the minimum required capital, he stressed that the estimate was simplistic.

“This is not what the rating agencies are saying. It's not an official view” but instead a way of getting a handle on how big the number could be, he said.

Damien Magarelli, a director for S&P, who presented details of the catastrophe charge in S&P's revised capital model on Monday at the S&P conference, noted at the CAS conference the 150 percent boost that Mr. Nakada applied to his loss estimate would assume that capital was held to the “double-A” rating level, representing a conservative view.

Mr. Nakada went on to make his number even bigger, noting at least $60 billion in catastrophe losses hit the industry in 2004 and 2005, followed by capital raises totaling only about $20 billion. Adding the $40 billion difference to the $82 billion figure, he said RMS' changed view of catastrophe risk could potentially push industry capital down by $120 billion.

“If these numbers are even close to reality, we've got a big hole to patch up,” he said.

Capital markets experts presenting figures on catastrophe bond issuance and sidecar developments at both meetings enthusiastically reported that investor interest is strong and growing.

But the figures they shared revealed such alternatives could not immediately step in to fill that kind of hole. For example, Cory Anger, senior vice president with Lehman Brothers in New York, said at the S&P conference that cat bond issuance following the 2005 hurricanes has totaled $2.5 billion, with sidecars adding another $2.5 billion.