AXIS Capital Holdings Limited has estimated that its Q1 results will include $235 million of claims related to the coronavirus (COVID-19) pandemic.
In total, AXIS Capital announced a net claims provision of $300 million, pre-tax, with weather related events making up the other $65 million.
The company said its claims provision for COVID-19 is largely attributable to property related coverages, but also includes event cancellation and accident & health coverages, and considers a global shelter in place order that remains in effect until July 31, 2020.
Weather events, meanwhile, included regional events in the United States, UK floods and Australia wildfires.
“COVID-19 has disrupted both society and the (re)insurance marketplace on a global scale,” said Albert Benchimol, President and CEO of AXIS Capital. “While COVID-19 continues to create unprecedented challenges and uncertainty for all carriers, we believe AXIS is well-positioned to manage through the pandemic.”
“We entered 2020 with strong capital adequacy, a high-quality investment portfolio, and a well-balanced book of business. Our portfolio optimization actions are delivering tangible results,” he continued.
“Our focus continues to be on providing our clients and partners in distribution with the same high level of service that they have come to expect from us.”
AXIS Capital expects to report a full limit loss of $10 million associated with the WHO pandemic swap.
In addition, the company expects to report net investment income of $93 million for the quarter, reduced from $107 million in the first quarter of 2019, primarily attributable to lower hedge fund returns.
It also expects net unrealized losses of $61 million attributable to its equity securities portfolio and net unrealized losses of $275 million for its fixed maturities portfolio, due to the significant decline in equity and credit markets at March 31, 2020.