Aon's clients suffered $1bn of losses from Tianjin

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Aon's clients alone have already suffered losses in excess of $1bn (£700m) from last year's Tianjin port disaster in China.

The broker, which has a joint venture Aon-Cofco in China, revealed the figures in its Asia Market Review 2016. Aon didn't provide information on the percentage of the losses which were insured when requested by Post.

Despite the deadly disaster costing the industry potentially billions of dollars it appears to have had relatively little impact on rates. There is an oversupply of capacity in the Chinese market which has led to intense competition and falling premium rates.

In its report Aon commented: "Underwriters have been somewhat more conservative writing business in specific industries, such as those handling hazardous materials and warehouse risks, but generally speaking the losses have been absorbed without much significant effect on pricing or available capacity."

It continued: "However, the accident highlighted issues around risk management and general underwriting standards that the industry is taking seriously."

Aon believes risk management will improve as reinsurers move onshore as a result of  China's Risk Oriented Solvency System by moving onshore reinsurers can lower their capital requirements. Lloyd's is forecasting an increase of 400% in onshore business.

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