US primary insurer Allstate has revealed that it incurred estimated pre-tax catastrophe losses of $990 million over the third quarter of 2020, or $782 million after tax.
The company put its September cat losses at $339 million ($268 million, after-tax), which added on to losses of $651 million ($514 million, after-tax) for July and August.
Cat losses in September included 20 events at an estimated cost of $293 million ($231 million, after-tax), plus unfavourable reserve re-estimates.
Of particular note were 11 wildfire events across California, Oregon and Washington, which accounted for approximately 65% of Allstate’s September cat losses.
Unfavourable reserve re-estimates during the month primarily related to $64 million of reserve strengthening, net of anticipated reinsurance recoveries, from Hurricane Laura.
Whilst it’s clear that the August figure in particular does not square with the latest estimates from Allstate, the company did not offer any insight into the discrepancy.
It’s likely that Allstate made recoveries for its July and August losses under its reinsurance for events in those months, namely on the major hurricane events. The fact that Hurricane Laura went up after reinsurance recoveries might suggest that as the loss crept higher more of Allstate’s reinsurance reduced the net total.
It’s also possible that factors such as California wildfire subrogation recoveries could have offset losses from the previous months, but this is only speculation.