Specialty insurer RLI is estimating its pre-tax catastrophic losses arising from Hurricane Ian will fall somewhere between $38m and $42m.
This figure, the firm said in a statement, will be reflected in Q3 2022. It added that this range is net of reinsurance and subject to change due to the complexity of the claims and preliminary nature of the information available.
The firm added that it would release its Q3 2022 earnings after market close on 19 October.
Other estimates released in recent days around Hurricane Ian losses include that of Heritage, which has reported $40m of net retained losses that it said were inclusive of reinstatement premiums and participation by its captive reinsurer, Osprey Re. It added that ultimate gross losses continue to be evaluated but are expected to fall within layer 2 of its catastrophe excess of loss program which begins at $140m and exhausts at $960m.
RLI, in its latest annual report, said it had $475m of catastrophe reinsurance limit available, after a $25m first-dollar retention. The rest of the net loss could be due to other retentions on facultative and quota share, as well as reinstatement costs, or commissions. The company also said it could retain losses above the reinsurance limit, should it blow through the available cover.
On a wind event, such as a hurricane, RLI had also said in its annual report that a modelled gross loss of $200m could drive a net loss of $46m, which may imply the impact it expects from hurricane Ian.
A similar loss has been reported by UPC Insurance, which disclosed that it expects to incur $36.4m of losses from Hurricane Ian in Q3. That figure is net of expected reinsurance recoveries, United specified, as it looks set to pass on most of the gross losses from the storm to the reinsurance market. UPC explained that the $36.4m figure consists of a net retention of $16.4m split approximately $7.4m to UPC and $9m to American Coastal Insurance Company, plus a $20m retention by its captive reinsurer, UPC Re. The company has received approximately 19,000 claims to date and estimates it will receive 27,000 to 30,000 claims in total with a gross estimated loss of $1bn.
Elsewhere, Universal Insurance Holdings said it has received approximately 18,000 claims following the impacts of hurricane Ian and expects its overall gross ultimate loss from the storm to be $1bn, which is below its $3bn reinsurance tower. Progressive, meanwhile, has said that it has incurred $1.4bn of property losses from Hurricane Ian, of which it is set to retain $200m.
Back to RLI—earlier this year, according to our sister site Artemis, RLI expanded its catastrophe reinsurance to buoy its property growth.
As Artemis wrote back then, RLI expanded its property underwriting in 2021, writing almost $348m of gross premiums across the year, an almost 30% increase from the almost $269m of property risks premiums underwritten in 2020.
To support the growth of property, Jen Klobnak, COO of the firm, said at the time that it was purchasing another $100m of catastrophe reinsurance limit, which would become effective from 1 January.
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