THE earthquake and tsunami in Japan will cost reinsurance giant Swiss Re an estimated $1.2bn (£739m) before tax, it said yesterday.
The loss would be from exposure to commercial and industrial claims for the catastrophe, it said, and not from damage to homes or the Fukushima nuclear power plant.
Insurance cover on commercial property also excludes nuclear contamination and in a statement Swiss Re said it believed the nuclear power plant crisis “is unlikely to result in a significant direct loss for the property and casualty insurance industry.”
It stressed that the figure was calculated from its own internal model of the event rather than real claims, and a final figure based on real losses to its clients would take “an extended period of time” to emerge.
The figure showed Swiss Re’s exposure to the catastrophe was about 70 per cent of its maximum loss from a one-in-250-year event, Execution Noble insurance analyst Joy Ferneyhough said. Analysts expected a loss of about $1.3bn-1.35bn.
Chief executive Stefan Lippe did not discuss how the loss would affect Swiss Re’s 2011 catastrophe budget.
“We extend our sympathies to the Japanese nation as they cope with the human tragedy and the destruction caused by this event,” he said. “We remain committed to using our expertise and experience to support clients in Japan.”
Swiss Re is the third insurer to provide an estimate for its loss. Smaller reinsurer SCOR said last week it estimated losses of €185m (£161m) while US insurer AIG said it anticipates a $700m loss. Swiss Re has already taken an $800m loss from the earthquake to hit New Zealand last month.