AXIS Capital reports $212m of Q3 cat losses, $160m from hurricane Ian

AXIS Capital, the Bermuda headquartered specialty insurance and reinsurance underwriter, has pre-announced an estimated $212 million ($186 million, after-tax) of catastrophe and weather losses for the third-quarter of 2022, including $160 million from hurricane Ian.

$100 million of the losses from hurricane Ian fell to AXIS Capital’s insurance division, while the other $60 million was due to reinsurance exposure to the major storm.

Another $13 million of weather related losses fell to the AXIS insurance business, while the remaining $23 million of announced losses fell to the reinsurance side, from European Convective Storms in June, and $16 million of reinsurance losses from other weather-related events.

AXIS said that it has picked an industry loss of $60 billion for hurricane Ian, excluding losses to the NFIP, which is one of the highest estimates opted for by a company that has pre-announced so far.

On the convective storm activity in Europe from June, AXIS said it has opted for an industry loss pick of roughly $7 billion, which is a more than doubling of the $3 billion pegged for this event at the end of the first-half.

That demonstrates the significant loss creep experienced with these convective storms in Europe, which include the French hail events.

The other cat losses pre-announced are largely from severe weather events in the United States, and typhoons in Asia, AXIS said.

Of course, AXIS Capital has exited property reinsurance now, but still has a written portfolio from earlier renewals and multi-year exposures to manage.

But the insurance side of the business remains exposed to natural catastrophe risks, which is evidenced in the split of losses from hurricane Ian.

AXIS Capital also has its AXIS ILS business, that works with Strategic Capital Partners and third-party investors, including through private quota shares and insurance-linked securities (ILS) type arrangements, so it’s safe to assume some amount of AXIS’ gross losses from hurricane Ian will have been shared with its investor partners.

AXIS said that even after accounting for these catastrophe losses, the company expects to report a small operating income for the third quarter of 2022.