Specialist insurance and reinsurance firm Hiscox Ltd. has estimated its combined net loss from hurricane Harvey and hurricane Irma as approximately $225 million.
Hiscox had previously pegged its hurricane Harvey only loss at around $150 million, suggesting that hurricane Irma is currently only thought to have added approximately $75 million to the seasonal impacts the re/insurer has suffered.
However, Hiscox has perhaps been able to combine some losses into its reinsurance program, as the company said this morning that, “Due to the interrelated nature of reinsurance recoveries for these two events, the Group is disclosing a combined figure.”
Hiscox has based its $225 million loss estimate on industry losses of $35 billion for Hurricane Irma and $25 billion for Hurricane Harvey (excluding the National Flood Insurance Program’s losses).
The company explained that there is uncertainty in the estimates still, but said, “This is within the Group’s modelled range of claims for events of this nature, and we still have depth of cover in our reinsurance programme.”
Hiscox Group CEO, Bronek Masojada, commented on the announcement, “Paying claims from devastating events like these is precisely what we are here for. Our focus is to get our customers back on their feet as quickly as we can.
“These events are already having an impact on rates in the global insurance market, particularly in affected areas and specific sectors. After a number of years of rate reductions, we are starting to see price corrections, most acutely in affected lines such as large property insurance and catastrophe reinsurance, which we expect to spread to non-affected lines. Although these are huge insured events, sadly, they also highlight the lack of cover in places.”
Hiscox has yet to report any impact from hurricane Maria’s impacts in the Caribbean and on Puerto Rico, which will add to the companies losses from the hurricane season.
The company is not the first to report that it is already seeing improved pricing, this has already been reported in retrocession and affected property catastrophe zones, with many now expecting continued price increases at the next renewal season in January 2018.