Re-Insurance

Insurers estimate losses from hurricanes

  • Devastating: Hurricane Irma caused appalling damage in St Martin (Photograph by Jonathan Falwell via AP)

A number of insurers and reinsurers have released estimates of losses they expect to book from three hurricanes and earthquakes in the third quarter.

Lancashire Holdings Ltd has estimated losses of between $106 million and $212 million.

The losses apply to hurricanes Harvey, Irma and Maria, which between them wreaked havoc in the Caribbean and the US, as well as two earthquakes in Mexico.

The loss exposures are through its Bermuda and Lloyd’s operations, as well as its involvement with the Kinesis third party capital facility, in which Lancashire has a 10 per cent stake.

The estimate falls well within Lancashire’s modelled loss ranges for these types of catastrophe events, the firm stressed.

Meanwhile, American International Group expects to report pre-tax catastrophe losses net of reinsurance of $2.9 billion to $3.1 billion. In a statement, AIG said pre-tax losses from Harvey are estimated at between $1.1 billion and $1.2 billion, with those from Irma in the region of $1 billion to $1.1 billion, and losses from Maria likely to be between $600 million and $700 million.

AIG also estimated that pre-tax losses from the Mexico earthquakes and other catastrophes will be approximately $150 million.

Bermudian-based Validus Holdings estimates that its net losses in the third quarter due to the hurricanes and earthquakes, net of reinsurance and a number of other factors, will be $378.9 million.

The companies cautioned that actual losses may vary materially from the preliminary estimates.