Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Swiss Re Warns of Q3 Loss After $1.3 Billion Hit From Hurricane Ian

Published 18/10/2022, 08:14
Updated 18/10/2022, 08:14
© Reuters

© Reuters

By Geoffrey Smith

Investing.com -- Hurricane Ian’s toll on the world’s insurance industry came into focus on Tuesday as Swiss Re (SIX:SRENH) said it expects claims of over $1.3 billion to cover the devastation caused by the storm.

The world’s largest reinsurer said it expects to have posted a net loss of $500 million in the third quarter as a result and warned that it’s likely to miss its profit targets for the year.

“While the 2022 target of 10% Group [return on equity] is unlikely to be reached given the impact from natural catastrophes, the Ukraine war, and financial market volatility, the Group remains confident in the mid-term outlook and committed to its 2024 profitability goals,” Swiss Re said in a statement.

Hurricane Ian, which battered the coast of Florida and South Carolina at the end of September, caused overall insured losses of between $50 billion and $65 billion, according to the reinsurer, although it noted that its preliminary estimates are, as always, subject to some big possible revisions later.

The group said its life and health business and its corporate solutions business remain on track to meet their targets of $300 million in net profit this year and a combined ratio of less than 95%. (The combined ratio measures the underlying profitability of an insurer’s underwriting business, stripping out the influence of investment income.)

However, property and casualty suffered is likely to miss its 2022 target of 94%, due to what the group called “an increase in small- to mid-sized claims, partly driven by economic inflation” – a further sign that inflation has crept into corners of the economy far from its origins in the supply chain disruptions of the pandemic and the shock from global energy prices.

Swiss Re stock has fallen some 21% this year amid concern that the sharp rise in global interest will cause heavy mark-to-market losses on its vast bond portfolios.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.