Bermudian reinsurance firm RenaissanceRe Holdings Ltd. (RenRe) is anticipating that its catastrophe losses will total $155 million for the third quarter of 2019.
The figure consists of $100 million in costs from Typhoon Faxai, and $55 million from Hurricane Dorian.
RenRe added that it is also in the preliminary stage of assessing the impact of Typhoon Hagibis, which will be reflected in its fourth quarter results.
The Q3 loss estimate accounts for the sum of estimates of net claims and claim expenses incurred, earned reinstatement premiums assumed and ceded, lost profit commission, and redeemable noncontrolling interest.
RenRe explained that it calculated the net negative impact of the catastrophes based on a review of its potential exposures, preliminary discussions with counterparties, and using cat modelling techniques.
In light of these estimated losses, RenRe expects to report modest net income and operating incoming in Q3, the company said.
“We extend our sympathies to all those affected by recent catastrophic events and recognize the significant human impact, particularly in the Bahamas and Japan,” commented Kevin J. O’Donnell, CEO of RenaissanceRe.
“As always, we hope to improve the resilience and sustainability of communities by supporting recovery and rebuilding efforts through rapid payment of claims and superior service to our customers.”
Typhoon Faxai, which makes up almost two-thirds of RenRe’s estimated Q3 losses, hit Japan on September 9th and caused widespread destruction across the Chiba, Kanagawa and Shizuoka prefectures.
Catastrophe modeller RMS has estimated that overall industry losses from Faxai will be between $5.0 billion and $9.0 billion.
But now, analysts at KBW are saying that Typhoon Hagibis, which made landfall on October 12 with sustained winds of over 85 mph, could be even more costly for the re/insurance market, with losses potentially exceeding $9 billion.
Hagibis affected an area of nearly 85,000 square miles, including the region impact by Faxai, meaning RenRe could be reporting an even larger loss estimate later in Q4.