Zurich Financial Services Group announced that it expects aggregate claims payments related to the four recent Atlantic hurricanes to be approximately $525 million before tax and net of reinsurance. “This corresponds to approximately $400 million after tax and net of reinsurance,” said the bulletin. The charges will be recorded in the third quarter.
CEO James J. Schiro commented: “Reacting to the tragedy caused by this exceptional series of storms was our first duty. Our next step was to estimate the claims payments. As a Group, it is our job to build the quality of earnings and balance sheet strength to be in a position to absorb the cost of claims payments arising from catastrophe events such as these.”
Zurich indicated that the “current estimate of potential claims is based on model calculations and reported claims. The estimate pertains to hurricanes Charley, Frances, Ivan and Jeanne that struck the Caribbean and the United States between August 10 and September 27, and it includes the claims estimate previously released for hurricane Charley.”
It also noted that recent estimates have put claims payments for the four storms in excess of $20 billion for the insurance industry. The amount exceeds the former record payment for hurricane Andrew in 1992. Andrew’s losses were around $15.5 billion, the equivalent of around $20 billion today.
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