Hiscox estimates hurricane claims at $225m
Hiscox said on Monday that net claims from hurricanes Harvey and Irma were likely to total around $225mm based on an insured market loss of $35bn.
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The Lloyd's of London underwriter said that although there is still a degree of uncertainty around the hurricanes, the figure is within the group's modelled range of claims for events of this nature and it still has depth of cover in its reinsurance programme.
Chief executive officer Bronek Masojada said: "Paying claims from devastating events like these is precisely what we are here for. Our focus is to get our customers back on their feet as quickly as we can.
"These events are already having an impact on rates in the global insurance market, particularly in affected areas and specific sectors. After a number of years of rate reductions, we are starting to see price corrections, most acutely in affected lines such as large property insurance and catastrophe reinsurance, which we expect to spread to non-affected lines. Although these are huge insured events, sadly, they also highlight the lack of cover in places."
In September, Hiscox estimated net claims of around $150m for Hurricane Harvey.
Shore Capital said it was reducing its 2017 pre-tax profit forecast by around £50m to £131m at this stage to allow for its estimate of the extent to which these losses have exceeded the group’s catastrophe budget for the year.
"We also note the comments from Hiscox's CEO that these hurricanes are already impacting pricing in the global (re)insurance markets, especially in loss affected areas. Large property insurance and catastrophe reinsurance were singled out by the CEO as areas where rates are already moving upwards, with non-affected areas expected to follow in due course.
"We fully concur with these observations and this commentary. The recent hurricane activity together with the Mexican earthquakes are likely to be catalysts for strong and steady rate increases over the coming months, in our view."
At 0806 BST, the shares were up 0.2% to 1,283p.