XL Group Ltd. announced its preliminary estimate of net losses of approximately $1.48 billion from third quarter natural catastrophes.
Included within that figure is $1.33 billion in losses relating to Hurricanes Harvey, Irma and Maria, the company said, noting that these overall and hurricane-specific estimates are pre-tax and net of reinsurance.
Hurricanes Harvey, Irma and Maria each contributed approximately 25 percent, 40 percent and 25 percent, respectively, to the company’s loss estimates, with 10 percent related to all other events in the quarter, most notably the Mexican earthquakes and Typhoon Hato, XL Group said in a statement.
The estimated losses are approximately evenly split between XL Group’s insurance and reinsurance units.
“Following these events and meaningful reinsurance recoveries this quarter, the company continues to have significant catastrophe reinsurance protections remaining for 2017 and 2018, including catastrophe bond protections, some of which extend through 2019,” XL said in a statement.
The company said its preliminary estimates are based on a combination of catastrophe modeling, exposure analysis and preliminary ground-up notifications and are consistent with private insured market loss estimates for Hurricanes Harvey, Irma and Maria in the range of $75 billion to $90 billion.
“Our hearts break at the havoc caused by these events; the terrible pain and anguish suffered. We are proud of our people, some of whom have had their own losses to deal with, who are working tirelessly with our partners to help our clients in these difficult times,” said XL’s Chief Executive Officer Mike McGavick.
“And, as ever, the problem of underinsurance is again laid bare, afflicting especially those already less well off. It is appalling, and all of us with expertise to offer must bend our minds to solving these systemic failures,” he added.
“In terms of the effects on XL itself, given the specific nature of the events themselves our estimated losses are largely in line with our expectations, and our capital strength and talented teams ensure that we remain positioned to continue solving the risk needs of clients and brokers,” McGavick went on to say.
“As for market conditions, risk awareness has changed due to these events, and this in turn should cause the market to move towards more realistic and sustainable pricing for the risks undertaken.”
Source: XL Group Ltd.