Ida triggers Travelers aggregate reinsurance in Q3, makes $95m recovery

Ida triggers Travelers aggregate reinsurance in Q3, makes $95m recovery

US main insurance company Travelers saw its catastrophe losses in the third-quarter of 2021 eat the remainder of the way through its aggregate reinsurance treaty layer retention, resulting in a $95 million healing throughout the period.Travelers had deteriorated through nearly 80% of the retention for its aggregate disaster reinsurance layer by the end of the first-half of 2021, as we formerly reported.
The staying 20% of the retention has now taken in losses from extreme weather condition and catastrophes during the third-quarter of the year, with the result being that the aggregate reinsurance protection was activated for Travelers during the period.
As a reminder, Travelers increased its aggregate disaster reinsurance security for 2021, with a renewed treaty covering 70% of a $500 million layer, so $350 countless coverage and a $150 million retention, above $1.9 billion of certifying losses.
By the end of Q1 Travelers had actually built up some $915 million of certifying losses towards the aggregate retention of its reinsurance, with that figure rising to approximately $1.5 billion by the end of Q2 2021.
For the third-quarter, Travelers has today reported catastrophe losses of $501 million pre-tax compared to $397 million pre-tax in the prior year quarter.
“We are very delighted to report exceptional underlying underwriting and investment results, adding to 3rd quarter core earnings of $655 million, or $2.60 per diluted share, and core return on equity of 10.1%, a strong outcome in spite of substantial disaster losses in the quarter,” said Alan Schnitzer, Chairman and Chief Executive Officer stated today.
Year-to-date, for the 9 months to September 30th, Travelers catastrophe losses, web of reinsurance, now stand at $1.811 billion, so running ahead of the prior years $1.584 billion.
Travelers aggregate reinsurance has not yet been as badly worn down as in 2020, offered the greater accessory point of its renewed aggregate disaster reinsurance treaty.
In Q3 2021, Travelers said that its disaster and non-catastrophe weather-related losses were decreased by $95 million of healings from its 2021 Underlying Property Aggregate Catastrophe Excess-of-Loss Reinsurance Treaty.
In 2015, catastrophe and non-catastrophe weather-related losses in Q3 2020 were reduced by $280 million of healings readily available under the aggregate reinsurance.
This years disaster losses are mostly from cyclone Ida, along with serious storms in numerous areas of the United States, Travelers said.
Travelers approximates its losses from hurricane Ida at $425 million, web of reinsurance.
Last year, the aggregate reinsurance treaty connected at $1.55 billion of losses, so through the accessory point increasing to $1.9 billion the reinsurance market has actually avoided what might have been another $350 countless losses.

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