Both France’s AXA Group and Germany’s Allianz AG, the world’s two largest insurance groups, raised their original estimates of potential losses from the terrorist attacks of Sept. 11 in the U.S. (See IJ Website Sept. 14) AXA’s net pretax loss after reinsurance payments will be around $550 million, and Allianz expects claims from all sources will exceed € 1 billion ($915 million).
The new estimates were released just as news came in that a chemical factory, owned by the petroleum group Total Elf Fina, in Toulouse in Southwestern France, had exploded with heavy loss of life. Latest reports indicated that at least 30 workers had perished, over 800 people in the factory and the surrounding area had been hospitalized, and some 50 more were reported missing. The blast, which was recorded by seismographs as far away as Paris, leveled the factory, which produced chemical fertilizers, and severely damaged many surrounding structures. Investigators have not yet determined the cause of the explosion, but have indicated that they’ve found no evidence of a terrorist act.
Neither company has as yet made any preliminary loss estimates, but AXA and Allianz subsidiary AGF are two of France’s largest p/c insurers, and will inevitably bear some of the losses, which appear to be substantial.
AXA indicated that overall claims from the terrorist attacks in the U.S. would approach $1 billion, initially from primary exposure of around $150 million from losses in life insurance, property/casualty and aviation, and subsequent reinsurance claims. The net figure calculates the amount of reinsurance AXA has in place. It estimates $400 million in net losses on “excess coverage on facultative or treaty reinsurance programs on Property risks and from retrocession and assumed business for specific known tranches.”
Allianz raised its estimates after reviewing its possible exposures to business interruption coverage and determining that claims would be significantly higher than it had originally anticipated.
Was this article valuable?
Here are more articles you may enjoy.