This was the second-worst catastrophe year for insurers on record, Willis Re says, with insured losses in excess of $100 billion and reinsured losses of more than $50 billion.

“There is work to be done by the industry to better understand the nature of the natural catastrophes which have caused 'surprise' losses this year,” says Willis Re, noting the flooding in Thailand as one example.

The market is not witnessing blanket increases, notes Willis. Instead, individual loss history and “perceived exposure movements” are driving increases.

Rate movements, Willis adds, are “largely being driven by the immediate earnings challenge of 2011 rather than the classic capital shortage of an historic hard-market rating turn.”

Overall, capital levels in the global reinsurance industry “are only marginally down” from the beginning of 2011, says Willis Re. If 2012 is profitable, it is not clear if the market will see sustained hardening, says the broker.

“With the exception of a few problem long-tail classes, reinsurers have concentrated on increasing prices for natural catastrophe exposed covers, which is leading to wide pricing differences by class,” says James Vickers, Willis Re chairman of international business in a statement.

Underscoring the extent of catastrophes this past year in theUnited States, the Insurance Information Institute says the number of separate federal government declared major disasters reached 99 in 2011, surpassing a record 81 set in 2010.

That figure is triple the average of 34 per year dating back to 1953, I.I.I. said on Friday.

“Catastrophes striking the United States in the first nine months of 2011 caused $32.6 billion in direct insured losses, nearly double the $18.6 billion in catastrophe-caused direct insured losses insurers generally incur over the first nine months of any given year,” according to Robert Hartwig, president of I.I.I. in a statement, citing figures released by ISO's Property Claim Services.

“The $32.6 billion figure doesn't even include the significant insured losses which arose after the pre-Halloween snowstorm, which caused enormous damage to multiple states along the Atlantic seaboard,” Hartwig continued. “Coupled with other events in 2011's fourth quarter, direct insured losses could exceed $35 billion this year.”

Hartwig notes that despite the frequency of catastrophes in theUnited States, policyholder surplus fell only 4 percent to $538.6 billion as of Sept. 30, compared to $559.2 billion at the end of 2010.

“The policyholder's surplus number is a sure sign that U.S. property & casualty insurers remain well capitalized and capable of paying future claims,” says Hartwig.