AXIS adds $125m of COVID losses, up to $80m cat losses from Q4

AXIS Capital, the Bermuda headquartered global specialty insurance and reinsurance firm, has pre-announced catastrophe losses for the fourth-quarter of 2020, revealing $125 million of additional impacts from the COVID-19 pandemic and up to $80 million from natural catastrophes during the period.

AXIS Capital logoThe fresh COVID-19 losses takes AXIS Capital’s total for the pandemic to $360 million reported so far.

AXIS said that the additional $125 million, of net and pre-tax losses, for the COVID-19 pandemic are announced after an extensive review of potential exposures on all lines of business, both short and long-tail, so likely across both insurance and reinsurance contracts.

In coming to the number, the re/insurer considered new information from its clients, global lockdowns that came into effect in Q4 2020 and also the outcomes of recent court judgments, including the recent UK Supreme Court ruling.

AXIS Capital had already recognised $235 million of pandemic losses in the first quarter of 2020 and the company now explains that these claims reserves “provide for ultimate COVID-19 related losses across all lines of business incurred at December 31, 2020.”

On top of the pandemic related catastrophe losses, AXIS also pre-announced an expectation of between $70 million to $80 million of pre-tax net natural catastrophe and weather losses from Q4 today.

These new nat cat losses come from events including Hurricanes Zeta and Delta, and regional weather events in the United States.

AXIS Capital also explained today that it is experiencing ongoing improvements in its current accident year loss ratios, excluding catastrophe and weather-related losses, consistent with progress observed earlier last year.

So in total AXIS expects a dent to fourth-quarter 2020 earnings of between $195 million to $205 million, net and pre-tax, from the pandemic and catastrophe events.

The additional losses may have ramifications for certain reinsurance or retrocessional coverage that AXIS has in place, we imagine, potentially also including any exposed third-party reinsurance capital arrangements it has in place and that could share in a portion of its losses from these events.

AXIS adds $125m of COVID losses, up to $80m cat losses from Q4 was published by: www.Artemis.bm
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Original Article Posted at : https://www.artemis.bm/news/axis-adds-125m-of-covid-losses-up-to-80m-cat-losses-from-q4/