AIG Projects $2B Sandy Loss; Chubb, Hartford, Hanover Among Carriers With Estimated Hundreds of Millions in Losses

The Warren, N.J.-based insurer says these amounts include estimated losses and loss expenses net of reinsurance recoverable and also include estimated reinsurance reinstatement premiums.

Chubb temporarily suspended repurchase of its common stock under its share-repurchase program due to uncertainty surrounding the losses it would sustain due to the superstorm.

Hartford, Conn.-based The Hartford says its initial gross loss and loss-adjustment expenses estimate from Sandy is approximately $370 million, before tax. Loss and loss-adjustment expense net of reinsurance is estimated at $350 million before tax.

About 60 percent of The Hartford's losses are in the P&C commercial segment.

The Hartford cautioned that the catastrophe numbers from Sandy are subject to change "due to the number of affected policyholders, the nature of the claims, the preliminary assumptions used to estimate gross losses and other factors." 

Worcester, Mass.-based Hanover Insurance Group says it estimates the after-tax earnings impact of Sandy will be in the range of $120-$140 million.

Based on its preliminary estimates, the company says "it is unlikely to exceed the retention on its domestic Property and Catastrophe reinsurance program."

The Hanover's domestic losses are primarily from Commercial Multiperil and Homeowners' policies in New York and New Jersey, the company notes, adding that "given the complexity of the claims process and the nature of the damage caused by Sandy, the actual amount of losses from this storm may differ materially from current estimates."

Ace expects about $380 million in losses in Q4 2012 related to Sandy. The estimate is after tax, net of reinsurance, and includes reinstatement premiums, the Zurich-based multiline P&C insurance group says.

Hamilton, Bermuda-based Montpelier Re Holdings predicts about $95 million in pretax losses from Sandy in 2012's last quarter.

The reinsurer says its prediction of fourth-quarter losses is also net of reinsurance and includes reinstatements.

Travelers estimates it will suffer a net loss of $650 million related to Superstorm Sandy. Its gross loss estimate, pretax and before reinsurance, is $1.135 billion. 

New Jersey Manufacturers Insurance Co. reports it will take a loss of more than $300 million from Superstorm Sandy—the largest loss in the company's history.

The West Trenton, N.J.-based mutual insurer is the third-largest provider of Homeowners' insurance in the state, with 280,000 households—and is the largest provider of Personal Auto insurance, with approximately 800,000 insured vehicles.

The carrier has received more than 52,000 Sandy-related claims to date, and says it has closed an estimated 45 percent of them and has issued disbursements of close to $100 million to policyholders. 

New Jersey Manufacturers Insurance's estimated loss figure is four times what it suffered from last year's Tropical Storm Irene, which cost $75 million and was at that time the largest claims event in the company's 99-year history.

The late-October storm brought strong winds and storm surge to the Northeast. Catastrophe modelers say Sandy could cause up to $25 billion in losses for the insurance industry—placing it among the costliest disasters in U.S. history.