Menu

Reinsurance News

W. R. Berkley puts Q2 cat losses at $145mn; includes $85mn COVID-19 hit

13th July 2020 - Author: Luke Gallin

W. R. Berkley Corporation has revealed that it expects to incur net catastrophe losses of roughly $145 million (pre-tax) for the second-quarter of 2020, most of which is attributable to the COVID-19 pandemic.

BerkleyThe firm estimates that approximately $85 million, or 59% of its Q2 loss estimate relates to the ongoing COVID-19 pandemic, following an updated review and analysis of existing and potential exposures in light of newly available information.

According to W. R. Berkley, the COVID-19 hit comprises primarily from contingency and event cancellation policies, workers’ compensation, professional liability and other liability-related products, as well as commercial property-related business interruption coverages. The loss total also includes other potentially exposed lines as well as defense costs and other loss adjustment expenses.

Alongside COVID-19, W. R. Berkley’s Q2 2020 cat loss estimate also includes $20 million for losses related to civil unrest in the U.S., and $40 million primarily attributable to severe weather-related events in the U.S.

“A substantial portion of the losses are classified as incurred but not reported (IBNR) reserves, in recognition of the high level of uncertainty in the estimates given the unprecedented nature of this event,” explains the firm.

Despite the above, W. R. Berkley expects to report a modest underwriting profit in the second-quarter of the year.

As well as the loss estimate, the firm has also announced that it anticipates that net written premiums in Q2 2020 will be comparable to Q2 2019, despite the downturn in economic activity.

“The industry’s fundamental need for pricing to reflect rising loss costs drove the acceleration of rate increases through the first quarter of 2020. That momentum is continuing and is further reinforced by the magnitude of industry losses for recent events. The Company’s average rate increases excluding workers’ compensation in the second quarter of 2020 were approximately 13%,” explains W. R. Berkley.

Print Friendly, PDF & Email

Recent Reinsurance News

Getting your daily reinsurance news from Reinsurance News is a simple way to receive only the reinsurance industry news that matters, delivered directly to your email inbox.

  • Only email is mandatory, but the more you tell us about yourself the better we can serve you in future!
  • This field is for validation purposes and should be left unchanged.

By submitting the form you are giving your consent to be emailed by us.

Read previous post:
Longevity reinsurance market to end 2020 strong after a resilient H1: Prudential

Prudential Retirement, part of Prudential Financial, Inc., has announced that it closed a significant $1.7 billion in new longevity reinsurance...

Close