Swiss Re expects $2 billion hit from Hurricane Ian
Swiss Re expects $2 billion hit from Hurricane Ian
24 October 2022
Swiss Re expects to report a third quarter net loss of around $US500 million ($796 million) as a result of preliminary Hurricane Ian claim estimates of about $US1.3 billion ($2.1 billion).
The group’s 10% return on equity target is unlikely to be reached for this year, given the impact of natural catastrophes, the Ukraine war and financial market volatility, but Swiss Re says it remains confident in the mid-term outlook and committed to its 2024 profitability goals.
Ian crossed the coastline in western Florida on September 28 with sustained wind speeds of about 240 km/h, making it one of the strongest hurricanes to ever make landfall in the US.
Swiss Re estimates the preliminary total insured market loss from the hurricane at $US50-65 billion ($80-103 billion), including the National Flood Insurance Program.
The company says its Life and Health Reinsurance and Corporate Solutions divisions remain on track to achieve respective targets this year of approximately $US300 million ($478 million) net income and a reported combined ratio of less than 95%.
But Property and Casualty Reinsurance reported and normalised combined ratios were affected in the third quarter by an increase in small- to mid-sized claims, partly driven by economic inflation. As a result, the business is unlikely to reach its normalised combined ratio target of less than 94%, Swiss Re says.
Swiss Re, which will announce its third quarter results on October 28, says it maintains a very strong capital position.
“This allows Swiss Re to pursue profitable opportunities in a hardening reinsurance market, while remaining committed to its capital management priorities,” it said.
