Update on first quarter catastrophes
Hamilton, Bermuda (30 March 2011) -- Hiscox Ltd (LSE:HSX), the international specialist insurer, has undertaken a first estimate of the impact of the 2011 New Zealand earthquake and the 2011 Queensland floods. The Group also makes an early comment on the Japanese earthquake and tsunami of 11 March.
Based on an insured market loss of US$10 billion for the New Zealand earthquake, and US$2.4 billion for the floods in Queensland, Hiscox estimates net claims of approximately £60 million and £15 million respectively.
Any estimate of the insured loss from the very tragic and severe earthquake in Japan is still at an early stage so considerable uncertainties exist. Hiscox’s exposure to this event is primarily through its underwriting of global and regional reinsurance and retrocessional programmes. Twice a year Hiscox publishes its expected losses for modelled catastrophes, including exposure to a Japanese earthquake. According to the latest published model1, from an insured market loss of approximately US$24 billion, Hiscox could incur net claims of between $60 million and $150 million with a mean loss of $100 million. Initial investigations suggest that this range remains valid.
Bronek Masojada, Chief Executive, commented; “The tragic impact of the Japanese earthquake is ongoing. Insurance exists to help rebuild communities after the havoc caused by catastrophes - paying claims after such events is what we are here for.”
Robert Childs, Chief Underwriting Officer, commented; “These events will only minimally impair our own reinsurance programme. In the reinsurance we underwrite, we have seen significant increases in rates for the affected regions and expect this pressure to become widespread.”
1Hiscox 2010 results analysts’ presentation 28 February 2011 (available on hiscox.com)
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Notes to editors
Hiscox, headquartered in Bermuda, is an international specialist insurance group listed on the London Stock Exchange (LSE:HSX). There are three main underwriting parts of the Group – Hiscox London Market, Hiscox UK and Europe and Hiscox International. Hiscox London Market underwrites mainly internationally traded business in the London Market – generally large or complex business which needs to be shared with other insurers or needs the international licences of Lloyd’s. Hiscox UK and Hiscox Europe offer a range of specialist insurance for professionals and business customers, as well as high net worth individuals. Hiscox International includes operations in Bermuda, Guernsey and USA. For further information, visit www.hiscox.com.
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