Asia must prepare for future “supercat” catastrophe events like those experienced in the US, says reinsurance intermediary Aon Benfield.

It says the US will almost certainly continue to rank number one in terms of supercat losses – at least $US10 billion ($10.03 billion) – but Asia can expect to face its own major losses.

Aon Benfield Head of Analytics Asia-Pacific Will Gardner says in a new report insurers and regulators should “recognise the possibility of supercat-sized earthquake losses and take action to ensure adequate catastrophe reinsurance protection”.

While natural perils in Asia do not appear to be increasing, he says market conditions are changing “with increasing insurance penetration and higher property values reflecting ongoing economic growth”.

“Property insurance penetration in Asia is generally low and weakest in residential lines but often high in commercial and industrial lines. Some insurers opt to purchase as little catastrophe reinsurance protection as possible to maximise their retained premium,” he said.

Aon Benfield says the Asian supercat loss scenarios include Japanese typhoons, and Chinese and South Korean earthquakes.