(Bloomberg) – Intact Financial Corp. said it will post insured losses of as much as C$1.1 billion ($850 million) from the wildfires in Alberta, which may dent the Canadian economy harder than Hurricane Katrina hit the U.S.
Intact, Canada's biggest property and casualty insurer, said the damage claims will lead to net losses of C$130 million to C$160 million, or as much as C$1.20 a share, according to a company statement Monday. The Toronto-based insurer had net income of C$147 million in the first quarter.
"The devastation brought on by the wildfires is unprecedented," Charles Brindamour, chief executive officer of Intact, said in the statement. "The scope of the damage and destruction that we have observed in recent days is a reminder of the important role we play in getting our customers back on track."
Industrywide insured losses could reach C$9 billion, according to reports from Bank of Montreal and others. With Canada's 2016 gross domestic product estimated at $1.8 trillion, or about 10% of U.S. GDP, the disaster could be bigger on a relative basis than Katrina, based on estimates from Imperial Capital. Katrina, the storm that devastated New Orleans in 2005, cost $60.5 billion, according to data from Munich Reinsurance and the Insurance Information Institute.
Intact's damage estimates imply industry-insured losses of C$4 billion to C$7 billion, according to a report Monday from National Bank of Canada.
Stock rebound
Intact rose 0.6% to C$88.02 at 11:33 a.m. in Toronto after falling four straight days last week, the longest streak since January, as the fires spread.
"Intact will easily earn their way through the impact of Fort McMurray wildfires," Jaeme Gloyn, an analyst with National Bank of Canada Financial, wrote in a report.
Intact said the assessment of insured damages, which was made using satellite imagery and exposure geocoding technology, is still early and assumes the wildfires won't return to Fort McMurray. The company received about 19% of its premiums from Alberta as of last quarter. RSA Insurance Group Plc and Allianz SE's Canadian unit are among other insurers that have been hurt by losses and claims from the fires, which forced the evacuation of more than 80,000 people.
The flames have scorched about 1,600 square kilometers (618 square miles) in the region, home to oil and gas producers including Suncor Energy Inc. and Cnooc Ltd.'s Nexen. At least 1,600 homes and structures were damaged, more than triple the number from the Slave Lake Fire in Alberta in 2011, previously the country's most costly fire and third-most expensive catastrophe overall, according to Aon Plc. Alberta Premier Rachel Notley plans to tour the city Monday to assess the damage.
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