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Hurricane Ian claims likely to push Swiss Re to Q3 loss
Published by Jessica Weisman-Pitts
Posted on October 18, 2022
2 min readLast updated: February 3, 2026
Global Banking & Finance Review®
Company
Published by Jessica Weisman-Pitts
Posted on October 18, 2022
2 min readLast updated: February 3, 2026
ZURICH (Reuters) -Swiss Re forecast on Tuesday a third-quarter net loss of around $500 million after the reinsurance company absorbed preliminary claims from Hurricane Ian of approximately $1.3 billion.
ZURICH (Reuters) -Swiss Re forecast on Tuesday a third-quarter net loss of around $500 million after the reinsurance company absorbed preliminary claims from Hurricane Ian of approximately $1.3 billion.
“While the 2022 target of 10% Group ROE is unlikely to be reached given the impact from natural catastrophes, the Ukraine war and financial market volatility, the Group remains confident in the mid-term outlook and committed to its 2024 profitability goals,” the reinsurer said in a statement.
Ian, which came ashore in Florida last month, was one of the strongest hurricanes to ever make landfall in the United States, subjecting the region to extreme winds, storm surges and torrential rain.
Swiss Re estimated the preliminary total insured market loss from Hurricane Ian at $50 billion-$65 billion.
Shares of the Zurich-based company were indicated to trade 0.7% lower.
The company said its (life and health) L&H Re and Corporate Solutions businesses remained on track to achieve their 2022 targets, while (property and casualty) P&C Re was unlikely to reach its normalised combined ratio target of less than 94% in 2022 given an increase in small- to mid-sized claims.
“Swiss Re maintains its very strong capital position, with Group (Swiss Solvency Test) ratio of 274%, as of 1 July 2022. This allows Swiss Re to pursue profitable opportunities in a hardening reinsurance market, while remaining committed to its capital management priorities,” it said ahead of quarterly results on Oct. 28.
Berenberg analyst Kathryn Fear cut her estimate for 2022 net income to $947 million from $1.72 billion.
“This is primarily down to Hurricane Ian, which, at our (loss) estimate of $1.1 billion, effectively uses up the group’s remaining natural catastrophe budget,” she wrote in a note, saying management had guided with half-year results that it had $1.2 billion of natural catastrophe budget for the second half.
(Reporting by Michael Shields, Editing by Kim Coghill, Miranda Murray and Sherry Jacob-Phillips)
Reinsurance is a financial arrangement where insurance companies transfer portions of their risk to other insurers to reduce the likelihood of paying a large obligation resulting from an insurance claim.
Natural catastrophes refer to severe weather events or natural disasters, such as hurricanes, earthquakes, and floods, that can cause significant damage and financial loss.
Capital management involves the strategies and processes that organizations use to manage their financial resources effectively, ensuring they have sufficient capital to meet their operational needs and growth objectives.
A net loss occurs when a company's total expenses exceed its total revenues during a specific period, indicating that the company has lost money.
Group ROE, or Return on Equity, measures a company's profitability by revealing how much profit a company generates with the money shareholders have invested.
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