Everest suffers catastrophe losses of $875m

  • Photograph by Noah Berger/AP

Devastating blaze: California's Camp Fire was one of the disasters to generate catastrophe losses of $875 million for for Bermudian reinsurer Everest Re in the fourth quarter

Everest Re Group racked up net catastrophe losses of $875 million as it posted a fourth-quarter net loss.

Hurricane Michael, the California Camp and Woolsey wildfires and an Australia hailstorm event were the main drivers of the natural disaster losses, the Bermudian-based reinsurer said.

For the fourth quarter, Everest’s net loss was $382.3 million, or $9.50 per common share, compared to net income of $571 million, or $13.85 per diluted common share for the fourth quarter of 2017.

However, for the full year, Everest was profitable, reporting 2018 net income of $103.6 million, or $2.53 per share.

Dominic Addesso, Everest’s chief executive officer, said: “During 2018 there were nearly $90 billion of insured industry losses, the fourth highest on record.

“Despite these events, Everest had both positive net income and operating income for the year. This result is testament to the diversification of our business across geographies, classes of business, and sources of capital.

“Everest’s long-term returns remain impressive, with five and ten-year average returns on equity still in excess of 10 per cent.”

After-tax operating loss was $236.9 million, or $5.89 per common share, for the fourth quarter, beating the $6.31 per share loss that was the average forecast of analysts tracked by Yahoo Finance.

The group’s combined ratio was 134.1 per cent for the quarter and 108.8 per cent for the year.

Net investment income amounted to $140.2 million for the quarter and $581.2 million for the full year 2018, up 7 per cent over the full-year 2017 results.

Net after-tax realised losses amounted to $143.9 million for the quarter.

Everest’s shares fell $1.42, or 0.6 per cent, to close on $220.38 on the New York Stock Exchange, before the results were released.